Major Highlights:
- Improved buyer sentiments along with end-user demand and infrastructural push kept Bengaluru’s real estate market relatively positive, as compared to other key markets in the country.
- Developers in the city focused on selling the already available inventory rather than completing ongoing projects and hence new launches dropped in Apr-Jun 2015.
- The proposal of Chennai – Bengaluru Industrial Corridor project, which will converge with Bengaluru – Mumbai Industrial corridor is seen as one of the growth stimulators to the realty market in the city.
- More than 75 per cent of the localities in East and South Bengaluru recorded growth in capital values in the quarter ending June 2015, indicating a burgeoning market.
Bengaluru, Aug 08, 2015: 99acres.com Insite is a quarterly report focusing on capital and rental price trends in the residential real estate market across seven major cities of India. The report not only captures the significant trends but also analyses and highlights the insights that make it valuable for both investors and end users. The report also includes an in-depth supply analysis to enable sellers and buyers determine the direction of the market. According to the report on Bengaluru, the capital market witnessed a growth of 3 per cent in Apr-Jun 2015 over Jan-Mar 2015. The rental market saw a surge of 8 per cent in the last one year, i.e. between Apr-Jun 2014 and Apr-Jun 2015. On the supply front, Bengaluru had 48 per cent properties available as ready to move. Maximum residential inventory was available in the budget bracket of Rs 60 lakh-1 crore, which constitutes the high-income housing category in the city.
Commenting on the report, Mr Narasimha Jayakumar, Chief Business Officer, 99acres.com,said , “One of the few steady realty markets across India, Bengaluru is resilient to real estate downturn due to its end-user driven market. East Bengaluru emerged as the most profitable investment zone owing to consistent infra development, the presence of IT hubs and healthy conversion rates.”
Price Analysis: East and South Bengaluru (Apr-Jun 2015 vs Jan-Mar 2015)
- East Bengaluru continued to be the most profitable zone in the city, recording an average growth of 4 per cent in capital values, during the second quarter of 2015.
- South Bengaluru , on the other hand, depicted a mixed trend with some localities posting appreciation, while others witnessing a dip in capital values.
- Varthur in East Bengaluru was the top capital grosser in Apr-Jun 2015, clocking a rise of over 20 per cent in capital values. The locality has grown immensely on the back of its proximity to the thriving economic hubs of Whitefield and the Outer Ring Road (ORR).
- Begur Road in South Bengaluru witnessed price hike to the tune of 7 per cent in the said quarter. Proximity to the famous IT hub – Electronic City and presence of self-sufficient infrastructure have been the major reasons for the growth of this stretch.
Rental Analysis: East and South Bengaluru (Apr-Jun 2015 vs Apr-Jun 2014)
- More than 75 per cent of the tracked localities in the two zones recorded a rise in rental values in the last one year. The IT corridor in the East continued to be a major contributor towards a promising rental market in the city.
- Brookfield in the East was the highest gainer , clocking a rise of more than 20 per cent in rental values in the last one year.
- The list of top performers, was however, dominated by localities from the South. Localities such as Singasandra and Bannerghatta made to the top with rental values recording a rise of more than 15 per cent, each.
- Price competitiveness led to increased demand in locations in and around Hosur Road such as Bommanhalli and Uttarahalli.
Price Trend Analysis: North, West and Central Bengaluru (Apr-Jun 2015 vs Jan-Mar 2015)
- North Bengaluru , one of the most promising real estate markets in the city, is gradually overtaking East and South Bengaluru as the commercial centre since these zones are nearing saturation. This has propelled residential development towards the North and West.
- Areas in the North such as Hennur Road, Hormavu and Thansisandra witnessed an increase of 5-11 per cent in capital values during the second quarter of 2015.
- Almost 60 per cent of the localities in the list of top performers were from the North even though the top grosser, Nagarbhavi, was from the West. It clocked a growth of 13 per cent in capital values in the quarter ending June 2015.
- Availability of residential options in the price range of Rs 3800-4300 per sq ft has bolstered the demand from those working in Peenya industrial belt. The proposal to build skywalks along the ORR, which would ease traffic from Nagarbhavi to the industrial hub, has also had a positive impact on capital values.
Rental Analysis: North, West and Central Bengaluru (Apr-Jun 2015 vs Apr-Jun 2014)
- Rental markets across Central, North and West Bengaluru remained largely positive in the last one year. With residential and commercial development shifting towards North Bengaluru the impact was reflected in the rental market too.
- Hennur Road, Thanisandra, Jalahalli, Jakkur and Yelahanka New Town registered a rise of 7 to 9 per cent in rental values from Apr-Jun 2014 to Apr-Jun 2015.
- Central localities , however, notched the top spots on the list of top performers in the Y-o-Y analysis. Proximity to Namma Metro and ease of access to different parts of the city resulted in increased rental values in Frazer Town, Lavelle Road and Richmond Road. These recorded a rise of 13-18 per cent in the last one year.
- In the West, Raja Rajeshwari Nagar witnessed the highest rise in rental values in the last year. Proximity to the NICE Ring Road garnered well for the locality’s rental market. It recorded a yearly rise of close to 10 per cent.
Supply Analysis:
- Availability of Different Property Types – Residential apartments constituted more than 80 per cent of the entire market share with maximum demand and supply noted in areas closer to the IT hubs in the city. While independent houses and villas had a modest supply of over 15 per cent, builder floors had negligible share in the listings.
- Availability of Property in Different Budgets – With growing focus on affordable housing in the country, Bengaluru saw an increased supply of homes within a budget of Rs 40 lakh. Mid-income housing category, having properties priced between Rs 40-60 lakh, continued to be the most supplied in the city and captured almost one-third of the total market share.
- BHK-wise Distribution of Property – High demand from IT professionals for both buying and renting mid-sized homes led to 2BHK units being the most popularly supplied in the city.
- Ready to Move vs. Under-construction – Similar to the previous quarter, Bengaluru had more than half of its inventory under-construction. With developers focussing on selling ready-to-move-in units and thereby, refraining from launching new projects, the supply statistics witnessed an insignificant change in Apr-Jun 2015, as compared to Jan-Mar 2015.
Link to report- http://www.99acres.com/articles/bangalore-insite-report-apr-jun-2015.html
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