“I was in Bangalore, India, the Silicon Valley of India, when I realised that the world was flat.”- Thomas Friedman
Bengaluru, the capital of Karnataka, is one of the most dynamic cities in India. This southern city is famous for being the bedrock of Indian Information Technology (IT) industry and is called the Silicon Valley of India. All these industry advancements have been conducive to the infrastructural development of Bangalore leading to a boost in the real estate market. Properties in Bangalore are one of the most preferred investments in the country.
Here’s a lowdown on the real estate market in Bangalore:
The Karnataka government is keen on improving Bangalore’s infrastructure. To support this vision, it has granted several approvals. These include increasing the premium for Floor Space Index (FSI) and cess on new layout approvals.
The implementation of the single-window clearance system has also smoothened the sanctioning process. It has brought transparency in the real estate sector with such an initiative.
The Karnataka Urban Development Authority (Amendment) Bill proposed a reduction in the open spaces in the residential areas. The bill also supports greater concretization of the city. Another weakness of the city is that there is a limited stock of ready-to-move office spaces.
The existing infrastructural developments in the city can work in the favour of the realty market. For instance, the completion of the Hennur flyover is likely to ease the traffic jams between parts of the city like Lingrajpuram, Bagalur, and Outer Ring Road. The proposed metro line between Whitefield and Marathahalli is yet another favourable development. Improved connectivity could make the city an attractive investment.
In the real estate market, there has been an episode of low sales in flood affected places such as Sarjapur Road, Gottigere and Bannerghatta Road. On the other hand, there is stability in the overall sale of realty projects in Bangalore.
Affordable housing is a segment that caters to the needs of price sensitive buyers. This segment has become popular because of a few notable builders like Shriram Properties, Golden Gate Properties, Ozone Group, Brigade Group, Nitesh Estate and Purvankara.
Such projects are undertaken in the suburban areas because of the cheaper availability of land. Areas such as Mysore Road, Kanakpura and Hosur road show a high demand for affordable homes.
Major local and national players are showing interest in this segment. These include Tata Housing, Usha Breco Realty, Godrej Properties and Ashoka Group.
The mid-income housing is a segment that is directed to the white-collar professionals working in the IT and IT-enabled service industries. There are numerous factors that make such housing desirable for this section of the society. These include social and physical infrastructure, proximity to schools, colleges and workplaces, access to various utilities and facilities and so on. Due to such facilities places such as Whitefield, Outer Ring Road, and Electronic City have witnessed a steady demand for mid-income housing.
Bangalore is the largest IT hub in the country. It is also the third-largest hub of High Net-worth Individuals (HNIs). The population of this IT major also comprises a large number of expats staying in India temporarily for work or other purposes. Therefore the Bangalore luxury housing segment targets such classes of people.
Places such as the Central Business District, Secondary Business District, Whitefield, and Outer Ring Road have seen a high demand for luxury housing. Such a demand is expected to have a steady demand.
Zone Specific Analysis
There is a persistent demand for high-end residential houses in the Northern region of Bangalore. There has been an active movement in the real estate market of this region after the construction of the Bangalore International Airport. The government is taking efforts to make this region the next economic centre of Bangalore. There are several luxury and mid-income projects in North Bangalore.
South Bangalore mostly consists of the upper-middle class of the society. The demand for high-end residential apartments in this region is low. It, however, increased after the Electronic City became known for its IT developments. Even then, the demand was still not significant due to below par urban and social infrastructure. However, the scenario has changed during the past few years. This region witnessed an increase in the real estate investments.
The Eastern region of Bangalore is home to several working centres like Whitefield. This IT hub has a good social infrastructure. Its physical infrastructure is also in the developing stage. There is always a high demand for luxurious housing in this area.
The real estate activity in this region is comparatively slower. This could be attributed to a lack of good social infrastructure. Also, a considerable distance from the major IT hubs can be yet another reason. There are no significant luxurious housing developments either. West Bangalore is rich on land for the development of real estate. Yet, the demand is low. Development of a Metro line might push the development of mid-segment residential housings in the area.
Location Specific Analysis
Peenya is an industrial area in Bangalore. It is known for its godowns and warehouses. With increasing industrialization, increasing number of people are settling in this area. Thus, there is a gradual growth of residential houses in this area. The Green Line of the Namma Metro has improved connectivity in the region.
Greenery is in abundance in Jalahalli. This is because it is home to the Jarkabandi state forest. This area has good connectivity. Transportation is not a problem because of the well-connected roads to National Highway 4 and other places. Thus, Jalahalli is said to be one of the rapidly developing places in Bangalore.
Ms Palya is a place in the Northern region of Bangalore. It is primarily known for its small-scale industries. It is developed in terms of infrastructure and boasts of several amenities and utilities.
Abbigere is a place in the Northern part of Bangalore. There has been a surge in demand for affordable housing in this area. This is due to several factors. One such factor is the presence of notable and established players. Another reason for such a surge is the proximity to railway stations.
This area holds the interest of a large number of buyers. This is mainly because of good connectivity and ease with which people can use the public transport. It has more than 200 ready-to-move-in projects accompanied by first-rate facilities. Thus, high living standards is yet another reason why people are interested in this area.
Hoodi is the hub of many corporate houses and business parks. Hoodi also makes it to the list of the biggest IT zones in Bangalore. Connectivity has improved in this region with the construction of a new railways station.
Investors are interested in this Southern Bangalore area because of good infrastructure and connectivity. Just like K R Puram, this region also has many ready-to-move in projects in Bangalore.
This IT hub of Bangalore is one of India’s largest electronic parks. It has good connectivity and amenities. It accommodates commercial as well as residential properties at affordable rates. Rightly so, it is included in the list of the best Indian locations to live in.
To sum it up
The Silicon Valley of India is witnessing a growth in the real estate market. The major drivers for growth and development is the rapid pace of IT development and startups. The increase in the number of HNIs is yet another contributing factor.