Bangalore Real Estate has emerged to be the IT capital of India already but there are other cities like Gurgaon, Noida, Delhi, Mumbai, Pune, and few others which are rapidly urbanizing. The Indian investor obviously has a plethora of choices but deciding where to invest or buy property becomes a difficult proposition. Here we analyze the comparative standing of Bangalore in terms of investment-friendliness today that was once considered as a retirement hideout for the elderly.
The Macroeconomic factors
First of all, let’s understand the factors that help real estate prices to grow! Research has unearthed that real estate prices are directly proportional to employment growth, GDP, infrastructure and population growth. In all these factors Bangalore fares really high. The influx of population to Bangalore from other parts of the country and the world is probably second to none. The reason is a spurt in education and employment along with other reasons for migration too.
According to the census, Bangalore has a population of 11,171,000 with the population density rising at 47% over a decade from 2001 to 2011. This has happened due to the employment generated by the city which has created ample amount of GDP increment. The urban district of Bangalore tops among the state’s GDP with a one-third share of the overall state’s GDP. The per capita income of the denizens of Bangalore has also been on a steady rise too according to the statistical reports.
The infrastructural investment of Bangalore has been increasing year-on-year along with the increment of the influx of the industries and the IT companies from worldwide. Bangalore tops among the startups in the country too. Unlike all other cities, prices of properties in Bangalore show a steady rise of about 20% year-on-year even in the most gloomy market conditions. When the whole of the real estate industry in the country suffered from higher inventory levels with the supply surpassing the demand, Bangalore scored the least with just about 1.04 lakh unsold units which is the least of the lot. With such glorious economic factors at the backdrop, Bangalore sets the scene of a prospective real estate investment for the ambitious investors.
The Bangalore city’s framework
A city normally grows along the highways and the transportation networks like the connectors to the central business districts much like the spokes of a wheel. Bangalore has a great advantage that way as the ring road connects all the four corners of the city to the central business districts. This has helped Bangalore to grow symmetrically and in a decentralized manner with IT Parks, townships, and posh residential areas all over the city. This is precisely the reason why the real estate prices are not contrastingly higher from one area to the other. There are few large IT Parks and zones like Whitefield and Electronic City with the government planning for few more where the concentration of the SEZ companies is more. Apart from these areas, there are IT Parks scattered all over the city along with major IT companies scattered all over the neighborhood. Needless to say, there are other large industries too to keep a balance with large industrial townships too.
This has led to the decentralization of the population leading to a balanced demand for real estate property all over the city much to the advantage of the real estate investors. The areas like Sarjapur road, Kothanur, Devenahalli and many more which were just small hamlets even half a decade ago are tinsel towns now with escalating property prices and high demand of apartments. Most of the developers of Bengaluru have also flogged to such areas with myriad projects and townships and gated communities too. The demand for such apartments in these upcoming areas is on the rise as the working population migrates to the city along with the industries flocking to the neighboring areas.
The social and other infrastructure of the city was always a first priority of the government as the industries demanded it. Bangalore has well-connected roads, flyovers, and the Metro connectivity along with the Outer Ring Road which has been solely responsible for accommodating the increment of the population year-on-year. The social infrastructure of the city like malls, marketplaces, entertainment centers and educational hubs are second to none. This attracts a lot of population as the city offers a great work culture along with a great life to play and live. Although Gurgaon and Noida may exceed in work opportunities, Bangalore has a favorable climate and the great life it offers becomes an extra factor for the immigrants that keep the demand and the supply of real estate ticking.
The prospective factors boosting returns on investment
Bangalore is on a mega expansion plan with major IT Parks coming up at Chikkabelapur and Devenahalli, with smaller ones scattered all over the city. The International Airport has already opened the doors for rapid development along the Bangalore-Devenahalli corridor with great social infrastructure development on both the sides of the highway. The Metro is on an expansion plan connecting Whitefield, Kengeri, Anjanapura, Bannerghatta road and all the other extremes of the city. The metro railway is already operational with a long stretch of 42.3 kilometers and propositions to stretch over a total of 72.095 kilometers. This means an immediate increase of real estate prices of the neighbouring areas.
Bangalore attracts population from all over the globe. The economic factors of the city are all favourable for real estate investment and development with a great climate and a promise of an enjoyable lifestyle. The infrastructure, entertainment, and employment generation of the city are also highly competitive with other A-1 cities of India and in cases even more. Contrastingly the real estate prices of the city are much lower than Delhi, Gurgaon or Mumbai. This is an added advantage for the investors and the homeowners alike who can expect a steady rise of their capital value year-on-year. The population pattern of the area is also favourable as Bangalore still attracts a lot of immigrants which is on the rise. All of these factors make Bangalore a great land for investment both for the realtors and the homeowners.
Key takeaways real estate investment:
- Research has unearthed that real estate prices are directly proportional to employment growth, GDP, infrastructure and population growth.
- Unlike all other cities, prices of properties in Bangalore show a steady rise of about 20% year-on-year even in the most gloomy market conditions.
- Although the infrastructure, entertainment, and employment generation of the city are at par or even higher than other A-1 cities of India and the real estate prices of the city are strikingly much lower than Delhi, Gurgaon or Mumbai making it the investors’ first choice.