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Bangalore Residential Market Insights

Bangalore Residential Market Insights Q1 2024

Bangalore Residential Market Insights

Bengaluru’s real estate market is thriving with rising demand from migrating professionals and continuous commercial growth. This dynamic interplay between demand and supply is pushing property prices higher, indicating a robust market. As the city expands, developers are meeting the demand with increased supply, fueling further growth.

Ready To Move:

The ready-to-move (RM) segment witnessed a solid quarter-over-quarter price growth of 4.0%. This increase highlights sustained demand for properties that are already completed and available for immediate occupancy. Such growth may indicate buyers’ preference for ready-to-move properties, possibly due to factors like convenience and reduced risks associated with construction delays. Developers may respond to this trend by focusing on completing and delivering projects promptly to meet the demand in this segment.

UNDER CONSTRUCTION:

The under construction (UC) segment experienced a notable quarter-over-quarter price growth of 5.7%. This uptick suggests strong demand for properties that are still in development stages, reflecting confidence in future market prospects. As projects progress towards completion, this growth may indicate anticipation of increased value and demand upon their availability, driving further investment in the under construction real estate sector.

Supply change of Ready to Move vs Under Construction properties:

The ready-to-move (RM) segment experienced a slight quarter-over-quarter dip of 1.6% in supply, possibly due to factors such as completed projects being absorbed by the market. Conversely, the under construction (UC) segment saw a notable growth of 4.0% in supply, indicating ongoing development activities and an influx of new projects entering the market. This divergence in supply dynamics between the two segments may influence market dynamics and buyer preferences accordingly.

Demand-Supply Analysis Bangalore Residential Market Insights:

In Bengaluru’s housing market, there’s a distinct preference for 3 BHK units, comprising a substantial 46% share of demand, closely followed by 2 BHK units at 45%. This trend suggests a strong inclination towards spacious accommodations among potential home buyers and renters in the city. Such preferences likely stem from factors such as lifestyle choices, family size, and the desire for extra space for various purposes, reflecting the evolving needs and aspirations of urban dwellers in Bengaluru.

Furthermore, a detailed examination reveals that the majority of homebuyers in Bengaluru favor larger apartment sizes, particularly those within the range of 1,250 to 3,000 square feet in covered area. These properties emerge as highly sought after, capturing a significant market share of 54%. This underscores a pronounced preference for spacious living accommodations among residents, reflecting evolving lifestyle preferences and housing requirements in Bengaluru’s urban environment

Bengaluru’s real estate dynamics demonstrate a clear preference for properties priced above INR 7,500 per square foot (psf) in terms of supply share. However, the demand share leans towards properties priced between INR 5,000 to 7,500 psf. This pricing pattern highlights the heightened demand from mid to high segment property seekers in Bengaluru, suggesting a willingness to invest in quality properties within a certain price range that offers both value and affordability.

BHK wise Average Rate Change (INR psf)

Quarterly and yearly analyses reveal consistent growth in rates (INR per square foot) across all housing configurations in Bengaluru. Notably, 1 and 2 BHK units exhibited the highest growth rates, both quarter-over-quarter (QoQ) and year-over-year (YoY). This trend indicates strong demand and possibly limited supply for smaller units, leading to rapid price appreciation. Consequently, the preference among homebuyers for larger residences is understandable, as they seek to mitigate the escalating costs of smaller units by opting for more spacious accommodations.

Average Rates (INR psf) (Property Type):

In Bengaluru’s real estate market, pricing varies across different property types. Builder floors average at INR 5,300 psf, multistorey apartments at INR 9,200 psf, residential houses at INR 10,500 psf, and luxurious villas at INR 12,600 psf. These diverse options cater to various preferences and budgets of homebuyers in the city.

Average rates (INR psf) (BHK wise):

Micro-Markets with Highest Demand:

Micro-Markets with Highest Supply:

CONCLUSION:

In the Bangalore residential market during January to March 2024, there’s been a consistent demand for properties driven by urbanization and employment opportunities. While larger units like 3 BHK remain popular, smaller configurations such as 1 and 2 BHK units are witnessing notable growth, balancing affordability and space needs. Property prices vary across different types, with builder floors offering affordability at INR 5,300 psf, while residential houses and luxurious villas cater to those seeking more space and amenities at higher rates. Supply dynamics indicate growth across all housing configurations, with smaller units experiencing higher growth rates, influencing buyer preferences towards larger residences. Despite fluctuations, the market remains resilient, reflecting sustained demand and diverse offerings, providing opportunities for developers and buyers alike.

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