Bangalore real estate market is experiencing tremendous growth, driven by the IT sector, start-up culture, remote work, and infrastructure development. High-end office spaces and spacious homes are being built to cater to multinational companies. Infrastructure improvements like new roads and metro lines are expected to improve connectivity and boost property values. The market is expected to continue growing in 2024.
With Bangalore’s thriving economy, varied cultures, and numerous opportunities to grow, the city draws many people from across the globe. Regarded as the hub of the IT industry, Bangalore is considered one of the most significant places for innovation. Organisations like IBM, Microsoft, and Google have established large offices in Bangalore. That’s not all; numerous start-ups and business owners are based in the city. Real estate in Bangalore has witnessed a massive transformation making it one of the most lucrative investment options. In this article, we’ll look at market trends in more detail while also analysing the factors affecting Bengaluru’s real estate market in 2024.
Table of Contents
Overview of Bangalore’s Real Estate Market
Real estate is a physical asset expected to produce a consistent income through rental yields or possible capital appreciation over time. This consistency gives homebuyers and investors a sense of comfort and fits their long-term financial objectives of accumulating wealth and securing a comfortable and wealthy future.
Residential Real Estate Trends
Bengaluru is a start-up and IT hub, attracting people from all over the world. Buying a home in a developing market like Bengaluru would be a blessing since you could invest your money here instead of paying rent.
For first-time real estate investors, the Bengaluru suburbs provide fantastic investment opportunities. The enormous floating population of Bengaluru comes to the city in pursuit of employment in the numerous MNCs, IT companies, and other industries looking to find homes closer to the workplace.
Hence, Bangalore’s suburbs have witnessed the construction of numerous luxurious homes and apartments. The significant growth and rental income rate suggest that investors should expect a sizeable return on their capital. There are clear benefits to purchasing property outside of Bengaluru.
Since Bangalore’s East and South Zones were known for their thriving real estate markets, those looking for homes were forced to search elsewhere due to the demand for affordable and diverse houses. Enter Bangalore North and its key neighbourhood Devanahalli, which are close to the Kempegowda International Airport, one of the notable features of Silicon Valley. Many houses are in the area, but the gated community plots—which allow buyers to design their homes whatever they like—are the most sought-after.
According to Knight Frank’s “Asia-Pacific Outlook 2023,” Bengaluru has emerged as one of the top real estate markets in the APAC area to watch out for. Out of the 24 markets the survey follows, Bengaluru’s residential market, which is anticipated to increase by 5% yearly, is the second-best.
Eight well-known cities, including Bangalore, Delhi NCR, Mumbai, Hyderabad, Chennai, Kolkata, Pune, and Ahmedabad, had their real estate markets evaluated by Knight Frank. According to the consultant, residential property prices per square foot increased in all eight cities from January to March this year.
Commercial Real Estate Trends
Due to its status as the nation’s top IT centre, Bangalore has been referred to as “India’s Silicon Valley” for decades. It is a vital hub for businesses in all industries, not just IT and start-ups. The city has financial support from both domestic and international investors, as well as talent that is freely accessible.
Bangalore is becoming more popular for businesses seeking office hubs close to well-established residential areas and higher-value real estate markets. Office space seekers are particularly interested in Electronic City, Whitefield, and Marathahalli, three of Bangalore’s central business districts. Let us look at the factors fueling the enormous company demand in these areas.
According to Knight Frank, the Indian office market is anticipated to continue its stable performance from 2022 through 2023. The growth rate for Bengaluru’s prime office leasing is predicted to be the highest among the 24 APAC cities studied in the report, at 5% to 7% YoY in 2023.
The need for flexible office spaces has increased due to the post-pandemic surge in hybrid work cultures. According to research, the percentage of coworking spaces in office space increased from 14% in Q1 2019 to a staggering 27% in January through March (Q1 2023).
As they want to provide flexible working arrangements that work with real workplaces, significant corporations and organisations, including start-ups, are adopting co-working and managed spaces at an increasing rate.
Bengaluru and Delhi-NCR, two top cities, are in the lead, accounting for 66% of net coworking absorption in Q1 2023.
Infrastructure Developments and Connectivity
Plans are also being made to build satellite cities near Bangalore to enhance expansion while decongesting it as the city’s allure draws more people here.
These towns will grow in Devanahalli, Doddaballapur, Nelamangala, and Bidadi along the currently under-construction Bangalore Satellite Town Ring Road (STRR). Additionally, these towns will be connected to the recently opened Bengaluru-Mysuru Expressway.
With various ongoing projects nearing completion, Bangalore will have enhanced connections within and with other significant towns nationwide.
On the one hand, plans are solidifying for the construction of the 518 km long, six-lane, access-controlled Bangalore-Vijayawada Expressway, which is expected to cut the current 12-hour travel time between the two cities to 6 hours. By 2025, the expressway should be operational.
However, the forthcoming 262-km Bengaluru-Chennai Expressway will cut the distance between Bangalore and Chennai travel times by 1-2 hours. Nitin Gadkari, the minister responsible for highways and road transportation, reportedly stated that the project should be finished by March 2024.
With various ongoing projects nearing completion, Bangalore will have enhanced connections within and with other significant cities nationwide.
The enhanced metro connectivity under the government’s Metro Rail Phase-2B will give the much-needed connectivity to Bangalore North from the IT clusters in other parts of the city, in addition to the Peripheral Ring Road and the Satellite Ring Road. According to a consulting and advising firm Meraqi report, another 350,000 new jobs will likely be produced in North Bangalore by 2025, accounting for almost 30% of the city’s total office absorption.
The need for housing in Bangalore is expected to grow significantly by 2025 due to all this infrastructure and connectivity development, driving up the demand for more than 100,000 units.
Sustainability and Green Real Estate Initiatives
In Bengaluru’s real estate market, sustainable green homes are a rising trend. These residences are built to have a minimal negative impact on the environment, consume less energy, and encourage environmentally friendly behaviours. Several developers are increasingly including sustainable features in their projects to address the rising demand for green homes in the city.
A key element of sustainable real estate is energy efficiency. Buildings that use less energy minimise the city’s carbon imprint and lower energy costs for residents and businesses. Energy-saving equipment, lighting, HVAC systems, and renewable energy sources like solar panels can all achieve this. Sustainable green homes are also planned with better indoor air quality and good landscaping to boost biodiversity.
In a recent analysis, CBRE India noted that the country’s total amount of green assets has increased by 37%. The report was titled “Indian Real Estate’s ESG Landscape and its Progress to a Sustainable Future.”
The utilisation of renewable energy sources, water conservation, and environmentally friendly building materials like bamboo or recycled steel are all significant characteristics of sustainable green homes. Smart thermostats, energy-saving appliances, and adequate insulation save energy use and utility costs. Long-term cost savings for homeowners are possible because the operating expenses of these homes are significantly lower than those of standard residences. Water conservation and lower water bills are further facilitated by installing wastewater treatment facilities and rainwater harvesting systems.
The Indian government has launched several efforts to promote the growth of green and sustainable housing since it understands how important it is. Building sustainability is measured using the “Green Rating for Integrated Habitat Assessment” (GRIHA) and “Leadership in Energy and Environmental Design” (LEED) certifications. Additionally, developers and homeowners who choose eco-friendly and sustainable procedures are given cash incentives and tax advantages. These government initiatives have significantly accelerated the development of green real estate in India.
The desire for eco-friendly living spaces is rising, and the government supports this trend with rules and incentives, which bodes well for the country’s green real estate market.
Technology has had an incredible impact on the real estate industry, and Bangalore is no exception. One of the most significant impacts of technology on Bangalore’s real estate has been the rise of online listings and property websites. Thanks to these sites, buyers can now readily search for homes that suit their preferences and financial constraints. Additionally, they have made it easier for sellers to advertise their properties and establish contact with possible buyers. The growth of real estate websites has opened up the Bangalore real estate market, allowing buyers and sellers to base their decisions intelligently on internet knowledge.
Precast technology is a concept used by contemporary construction companies like SOBHA Limited. It is one of the major technological advances in the construction industry that contributes to the development of high-quality construction. This technological development is one of the fastest and most effective construction methods available today.
Precast concrete is a style of building where concrete is poured into a mould that can be used again and again before being handled in a controlled environment (a recasting factory). The cast concrete building is then brought to the construction site and put in place. Among other things, precast concrete may be used to build structural components like concrete floors, blocks, and frames. Precast concrete buildings are resistant to fire, severe weather, insects, and mould.
Due to its unmatched resilience to rain, wind, earthquakes, termites, and rot, it requires less maintenance and insurance. In the winter season, it can endure several freeze-thaw cycles better than other building materials.
Another significant way technology influences Bangalore real estate trends is by introducing virtual property tours. Virtual tours allow potential buyers to see homes without actually going there. This was a significant development, particularly during the outbreak when people could not physically visit homes. NRIs and other investors may now remotely view houses thanks to virtual property tours.
Mobile apps have made it simple for buyers and sellers to get information while on the go. Depending on their location, budget, and interests, buyers may utilise mobile applications to search for homes. They also allow sellers to interact with buyers and market their properties.
Investors and buyers might benefit from analytics tools to help them make data-driven decisions. They could evaluate the availability and demand for houses in various locations and pricing patterns. This has made it easier for buyers and investors to locate investment opportunities and form wise judgments.
Legal and Regulatory Updates
In India, different laws apply to real estate in various states. The Real Estate (Regulation and Development) Act of ad 2016 (RERA), the Transfer of Property Act of 1882, and the Registration Act of 1908 are crucial pieces of legislation impacting the nation’s real estate market.
The Real Estate Act of 2016 examines the creation, promotion, and sale of real estate developments to protect investors’ interests. The Real Estate Regulatory Authority (RERA) and the Appellate Tribunal were established as an alternative dispute resolution mechanism under the Act. Additionally, it requires any real estate developments that fall under its purview to be registered. To ensure that federal legislation is carried out locally, many States have enacted similar RERA rules.
Indian Stamp Act, 1899 and Registration Act, 1908:
These acts regulate the rules pertaining to the requirement for the registration of various deeds, instruments, and papers related to the transfer of an interest in the moveable property and the payment of stamp duty on said documents.
Verifying property-related papers to ensure they are authentic and legitimate is essential during legal, due diligence. A sale deed, land title records, records of past owners, a possession certificate, and approvals for building plans are a few examples of these documents. This paperwork should be thoroughly examined to find any inconsistencies or potential problems with the property.
Investment Opportunities and Forecast
Any investment you make in Bengaluru will be profitable. However, specific locations are anticipated to generate a higher return on investment than others. More excellent investment is expected in several areas of Bangalore, including Banashankari in the south, Devanahalli and Thanisandra in the north, and Panathur in the east.
Bangalore’s economy is proliferating, and the IT industry is its main driver. Numerous IT businesses and start-ups are based in the city, which has recently experienced an economic boom. Strong economic growth has increased housing demand, making it an ideal real estate investment location.
Significant Rental Yields:
Bangalore is a desirable location for real estate investors searching for a reliable source of income because there is a substantial demand for rental properties there. The rental yield in the city is between 5 and 7 percent on an average, which is highly alluring to investors, according to the NoBroker Rent Report 2024.
Rising Housing Demand:
Bangalore’s population growth and the number of individuals relocating to the city for employment have resulted in increasing housing demand. It is now a fantastic opportunity for investors to enter the market because this has recently increased real estate prices.
Bangalore Real Estate Market Forecast 2024
The forecast for Bangalore real estate in 2024 is generally positive. Here are some of the key trends below:
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Market Growth:
Experts predict continued growth, with Knight Frank Asia-Pacific Outlook 2023 forecasting a 5% annual increase in residential property prices. Business Insider India is even more bullish, projecting a 12% jump in prices for 2024.
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Emerging Micro-Markets:
Bangalore’s real estate market has been booming in recent years, and with that growth has come the rise of micro-markets. These micro-markets are smaller pockets within the city that offer unique features and appeal to specific demographics.
Emerging Areas include:Outer Ring Road (ORR): Great for IT professionals due to office space and connectivity. This area, which includes Sarjapur Road Junction, KR Puram, and Hebbal, is a key office micro-market.
Whitefield: A major IT hub with good mix of residential and commercial options.
North Bangalore: Well-connected with good infrastructure, attracting families and investors.
East Bangalore: Excellent infrastructure, educational institutions and companies, making it ideal for families and professionals.
Areas like Hebbal, Sarjapur Road, Panathur Road, and North Bangalore are expected to see strong growth in both residential and commercial segments.
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Investor Interest:
Bangalore’s real estate market is attracting investor attention. Knight Frank ranks it as the second-best performing market out of 24 tracked in the Asia-Pacific region.
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Factors Driving Growth:
Bangalore’s growth is driven by several key factors:
Thriving Tech Industry: Known as the “Silicon Valley of India,” Bangalore boasts a robust IT and tech sector, drawing talent and investment.
Strong Startup Culture: A supportive environment for entrepreneurs fuels a steady flow of innovative startups, cementing Bangalore’s status as a tech hub.
Government Support: Policies promoting IT growth and infrastructure investments, like the metro rail network, enhance connectivity and attract businesses.
Skilled Workforce: The city’s top universities and educational institutions produce a highly skilled talent pool tailored to the needs of the tech industry and startups.
Infrastructure Development: Ongoing improvements such as better roads and a metro system enhance the quality of life and facilitate business operations.
A growing population, a strong job market, and ongoing infrastructure development are all contributing to the positive outlook.
Here are some additional things to consider:
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Inventory Levels:
Market activity and unsold inventory play a role in price fluctuations. Stay informed about current levels to make informed decisions.
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Construction Costs:
The Construction material costs have been rising in Bangalore, along with many other places around the world. This adds to the overall cost of construction projects. Rising material costs may lead to higher property prices.
Overall, Bangalore’s real estate market seems poised for a good year in 2024. However, careful research and consideration of your individual needs are still crucial before making any investment decisions.
Conclusion
The best way to ensure a better future in a city like Bengaluru is, without a doubt, to own a property. Now is the best time to invest your money in your perfect home. Choose a reputable builder and ensure that your home buying experience is simple and stress-free and what’s even better is you can be sure of an on-time delivery. Residential developments in Bengaluru combine a high standard of living with modern and spacious homes equipped with high-class amenities and stunning views.
FAQ’s
1. What is the forecast for real estate in Bangalore in 2024?
Bengaluru is ranked as the second-best market in APAC cities to watch out for in 2023 from the perspective of the residential outlook. Bangalore's real estate market is expected to rise and continued growth in 2024, with rising prices and strong investor interest. Expect a seller's market with potential price increases of 5-12%.
2. Is real estate a good investment in Bangalore in 2024?
Bangalore real estate looks promising in 2024 with rising prices (5-12%) due to strong demand. Also, the best year to buy real estate in Bengaluru is 2024 due to increased investors, especially NRI and OCI, and a solid economic outlook. But do your research before investing.
3. Is 2024 a good year to buy a house in Bangalore?
Yes. Bangalore's real estate market is growing in 2024, but it depends on your goals. It could be a good time if you're looking for an investment with potential appreciation. However, prices might be higher than usual. Consider your budget and long-term plans before deciding.
4. Why is real estate booming in Bangalore?
The demand is driven by the city's expanding population as well as a relatively lower expense of living. According to real estate trends in Bangalore, many people are looking for opulent and easily accessible dwelling options.
5. Will flat prices go up in Bangalore?
Bengaluru, the capital of Karnataka, witnessed the most increase in house costs, at 7%, while Mumbai saw a 6% increase. In contrast, prices in Chennai and Hyderabad increased by 5% each in the first quarter of 2023.
6. Why is house rent so expensive in Bangalore?
Rising traffic congestion could have increased Bengaluru rentals. In general, traffic jams force people to pick residences close to their workplaces, typically concentrated in particular locations, increasing the demand for apartments.
7. What is the future growth of Bangalore?
Residential prices in the city are expected to rise by 5% yearly, according to Knight Frank's Asia-Pacific Outlook 2023, making this the perfect time for investors and purchasers to explore Bengaluru's real estate market. One can expect to reap higher returns in the future.
