Is Home Price Going Down in Bangalore?

Bangalore's real estate market is currently experiencing a complex interplay of factors that influence home prices. While some short-term fluctuations have been observed, the overall trend suggests that home prices are unlikely to decline significantly in the near future. Here’s a detailed analysis backed by statistics and trends.

Current Sales Trends

In the first half of 2024, Bangalore's residential real estate market recorded a 9% increase in sales compared to the same period in 2023, indicating strong demand driven by the city's robust IT sector and ongoing infrastructure developments. However, there was a 40% decline in sales when compared to the previous quarter, Q4 2023, suggesting that seasonal factors or market corrections may be at play.

Price Projections

Experts forecast a 5% to 12% increase in residential property prices for 2024. Knight Frank’s Asia-Pacific Outlook predicts a 5% annual growth , while Business Insider India projects a more optimistic 12% jump in prices. This positive outlook is underpinned by the city's economic resilience and the influx of professionals relocating for job opportunities.

Rental Yields and Demand

Bangalore remains an attractive market for real estate investors, with rental yields averaging4.45% in Q1 2024—up24% since the COVID-19 pandemic. The city's growing population, currently at14 million with a2.94% increase from the previous year, continues to drive demand for housing. This demographic trend is critical, as it fuels both rental and purchase markets.

Infrastructure Developments

Significant infrastructure projects are underway, including the new metro line connecting central Silkboard to Kempegowda International Airport, expected to be operational by 2026 Other projects, such as the Peripheral Ring Road and expressways, aim to improve connectivity and reduce travel times, further enhancing the appeal of residential areas. Such developments are likely to increase property values in the vicinity.

Emerging Micro-Markets

Certain micro-markets within Bangalore are gaining traction as investment hotspots. Areas like Sarjapur Road ,Whitefield, and North Bangalore are particularly noteworthy, driven by robust infrastructure and commercial activity. These regions are expected to see substantial growth in both residential and commercial segments, making them attractive for investors looking for high returns.

Conclusion

While there may be short-term fluctuations in home sales and prices, the overall trend in Bangalore's real estate market points toward growth rather than decline. The combination of rising demand, significant infrastructure investments, and a favorable economic environment suggests that home prices are likely to increase in the coming years. Investors and prospective buyers should remain optimistic and consider the long-term potential of the Bangalore real estate market.

Connect us at +91-81979 43006 to find the best new properties to invest in and keep yourself updated by subscribing to Proppulse.