The residential real estate market in Bengaluru is seeing significant price surge as a result of rising demand and a lack of inventory.
Areas like Bagaluru and Hennur are experiencing a surge in demand as buyers and investors increasingly look north. Moreover, regions like Whitefield and Varthur-Sarjapur are seeing significant cost increments. Pandemic demand is to a major reason for this price increase, with more than 94% of new supply coming from the middle and premium markets.
A new report by land consultancy firm ANAROCK notes that Bagaluru in North Bengaluru has encountered the main cost appreciation, with private property estimations taking off by 90%, from Rs.4, 300 per sq. ft. in 2019 to Rs.8, 151 per sq. ft. in the first half of 2024.
With a new supply of approximately 36,150 units, Sarjapur Road saw a price increase of 58%, with 74% falling into the mid- and premium segments and 18% falling into the luxury category. From 5,870 yen per square foot in 2019, prices will rise to Rs.9, 300 per square foot in the first half of 2024. Whitefield saw 18,600 new products launched this year, 66% in the middle and premium categories and 34% in the luxury category.
Additionally, rental prices in Bengaluru have increased by approximately 5-8 percent over the past year, making renting more expensive. This vertical pattern is fuelled by the developing interest for investment properties, fundamentally in sought-after areas near work places and conveniences. Furthermore, the heightening expenses of homeownership are provoking more individuals to pick leasing as a more plausible choice.
Shivam Agarwal, Vice President Strategic Growth, Sattva Group says, “The shortage of ready-to-move-in inventory in key micro-markets is one reason causing the hike in demand”.
Similarly, Viswa Prathap Desu”, COO of Residential, Brigade Group notes, “High-demand areas such as Whitefield, Varthur-Sarjapur areas, areas of North Bengaluru, etc., witnessed prices shoot up drastically”.
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