Bangalore Real Estate 2024: The Surge & Outlook

Bangalore realty is now at an all time high and we can see hundreds of investors and homebuyers riding the wave.

Perhaps since 2008, the Q3 of 2023 has seen the highest number of quarterly sales. Not just Bangalore but all of the top 7 Metro Cities of India such as Mumbai, Hyderabad, NCR, Chennai etc are also seeing a rapid revival. Though most of the industry pundits claimed that the trend was spawned out of Post Covid rush, what we witness is that the premium properties now have more takers than in previous years.

Bangalore Residential Realty 2023: Q3 & Q4

Exceeding Expectations!

Bengaluru witnessed a significant growth in residential unit launches in Q4, reaching around 10,200. This represents a 24% growth on a quarterly basis and a 10% expansion compared to the same period last year. The full-year residential launches stood at over 34,300, reflecting a 1.3% growth over the momentum recorded in 2022.

The eastern micromarket (East Bangalore) continued to dominate with a majority share of launches, with locations like Whitefield, KR Puram, and Sarjapur Road accounting for around 54% of launches in Q4. Eastern and south-eastern micromarkets contributed approximately 65% of launches for the entire year, indicating strong demand from homebuyers in proximity to major IT corridors. The northern submarket, particularly Thanisandra Main Road, contributed 39% of the launches during the quarter. This year saw fairly lesser number project launches near KIA or Bangalore International Airport or Devanahalli.

Mid & High-End Luxury Properties

High-end and premium luxury units accounted for an all time historic high of 56% of Q4 launches, surpassing the previous quarter's 49% share. Which infact boosted the real estate segment of micro realty hubs. Locations like Thanisandra Road (North), Whitefield (East), HSR Layout, and Koramangala (South) recorded several high-end and luxury project launches in Bangalore.

Bangalore Real Estate's Emerging Trends in 2024

According to Priyatham Kumar, CEO of Homes247.in "Customer Preferences in the luxury housing segment lean towards technology-integrated 3BHK, 3BHK+, and 4BHK homes featuring bespoke elements and extravagant amenities. Many developers provides now customization choices to convert existing 2BHK flats into 4 BHK Duplexes to match up to this trend. The luxury housing segment remains resilient to market upheavals and global aftershocks, positioning it for a new phase of expansion."

Most of the builders and developers in Bangalore are all set to launch newer properties in the upcoming locales in South Bangalore to tap into the 2024-2025 market trends.

Demand for Second Home

Many of the migrant populace especially the IT professionals are investing in a second home purely on an investment model within the city. Areas in South Bangalore like Hosa Road, Choodasandra, Attibele, Anekal are now sought after for both low rise apartments and also gated community plotted developments.

Row houses and villaments are also on the list, albeit for premium residential areas such as Central Business District (CBD), Koramangala, Jaynagar etc.

Analysing the Shift in Home Buying Trends: Factors Driving the Momentum

Preference for Home Ownership: The security associated with owning a physical asset during crises, like the COVID-19 pandemic, has led to increased demand for residential real estate compared to renting.

Pride of Home Ownership: As mentioned before homeownership is escalating to the mid & premium segment, as now more and more Indians sense a mood of growth and spending is now equated more or less investment propectives.

Shift from Rent to EMI: Many tenants now view rent as an expense and are considering Equated Monthly Installments (EMIs) as Systematic Investment Plans (SIPs) to build non-volatile assets like real estate.

Affordable Home Loan Interest Rates: The general homebuying attitude of customers is very much influenced by relatively cheaper home loan interest rates, currently averaging between 8.75% and 9.5%. Along with this the percentage of coverage/disbursement is also very critical.

The prevailing momentum in the real estate market is expected to continue into the upcoming year.

Factors contributing to this momentum include strong cash flow among developers, an increase in new launches and house sales, buoyant homebuying sentiment, and consumers' pursuit of financial security. Despite property price escalations, sales in the real estate market remained robust, indicating a strong affinity for homeownership among prospective homebuyers.

Commercial Real Estate 2024 Outlook

Hybrid Work Challenges and the Future of Offices:

The efficacy of the hybrid work model emerges as a critical question for the commercial real estate sector in 2024. Employers emphasize on-site work for collaboration, while employees cite the productivity benefits of remote work.

Social Media sites including Linkedin, have seen heated arguments from both sides, however reality presents a picture of a definitive era that promotes on site opportunities. Bridging this gap necessitates creating offices tailored for a hybrid workforce, utilizing data and human-centred design to enhance the employee experience.

AI Integration and Sustainable Real Estate:

The adoption of Artificial Intelligence (AI) into real estate has transcended hype phase, becoming very integral for handling complex data and contributing to sustainability efforts. Indian Real Estate Organizations grapple with fully harnessing AI's potential and navigating emerging regulations concerning data quality, IP rights, privacy, and security.

As we look ahead to 2024, the city's real estate sector appears poised for a bright future. Compared to most of its metropolitan counterparts, one of the biggest advantages the Tech Capital of India possess is that most of its neighbouring municipalities, towns and villages are eager to be part of its entire ecosystem and even part of Bangalore itself. Thus paving way to a growing megapolis, laden with much more real estate opportunities.

Bengaluru, with its dynamic real estate landscape and commitment to technological advancement, stands as a beacon for a thriving real estate market, offering a compelling outlook for the years to come.