5 Trends that Bangalore Real Estate Sees in 2014

Bangalore, the third largest city in India and nation’s leading IT corridor has a real estate market that derives demand for every sector of the real estate; commercial and residential. The real estate market has been on a positive side for the city and 2014 brings some trends that add to the popularity of the city. The following article talks about the five trends that the city sees in 2014.

Bangalore situated on the southeast of Karnataka covers an area of 741 square feet. It is one of the major economic centers in India contributing a major to the Indian economy. The “silicon valley of India” attracts a lot of working population nationally and internationally.  The residential real estate in Bangalore is led by the increasing workforce. Therefore, the city’s real estate is clearly defined by the commercial as well as residential demands. 

Bangalore Real Estate Scenario in 2013

Bangalore unlike many real estate markets witnessed strong residential real estate market in 2013. The demand drivers for the real estate of Bangalore can be clearly credited to the:

•   The growth of IT/ITES sector in the city constantly expanding the commercial needs of the city
•    The supporting infrastructure that is constantly being upgraded with projects like the metro rail, the outer ring road (ORR) and elevated roads
•  The increasing population in the city that generates demands for the residential real estate

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In all, it is not wrong to say that the city has a huge potential when it comes to real estate. Year 2014 brought such trends that proved city’s potential in the real estate sector. 

Bangalore: Trends in 2014

Shweta Jain, Executive Director Cushman & Wakefield stated that the factors such as slow economic growth and unrest in the market due to inflation and slow real estate developments has led the more probable markets of Mumbai and Delhi-NCR to witness a less rate of appreciation

#1: Bangalore appreciated the most in the mid-segment housing section

During the last three years, Bangalore has witnessed an appreciation of about 41%. This brings the city on number one when it comes to mid-segment housing sector. The range of capital value appreciation of the residential real estate in Bangalore, in the last three months ranged between 14% and 41%.

Launch of quality developments in North West Bangalore and their proximity to the airport are the prime reasons that have a role to play in this appreciation. 

#2: The Bangalore realty market attracts maximum private equity investments in the country

In the first half of 2014, Bangalore attracted maximum private equity investment. The real estate of the city led by high demand for office spaces and residential demands as well brings Bangalore ahead of the primary markets of Mumbai and Delhi-NCR.  The first quarter of 2013 recorded 103 crore of private equity investments which increased to 2005 crore in the first quarter of 2014. Why is Bangalore attracting a good rate of private equity investments? This is because:

#3: North Bangalore gaining Momentum in the Residential Real Estate Market

Talking about the residential real estate of Bangalore, then areas in North Bangalore due to their proximity to the Kempegowda International Airport is gaining strong momentum. The region is also witnessing development of technology parks with a number of IT companies and a proposed SEZ adds to the increasing demand of residential real estate in this area. 

Yelahanka, Hebbal, Devanahalli and Hennur Road in the North and North East are the major areas that are gathering the attention of investors. 

#4: Office Space witness maximum demand from IT/ITES sector

Bangalore is one the key office markets in the southern part of India and the city has primarily grown because of the IT/ITES sector.

Bangalore has four major types of industries that generate office space demand. The industry sectors which have major role to play in the city are:

•  IT/ITES
• Banking and Financial Services Industry
• Manufacturing
• Others

Bangalore has been witnessing the major demand from the IT sector in terms of office space past three years, it being the nation’s major IT exporter.  Hence, 2014 also sees maximum demand driving from this sector.

#5: 2014 is experiencing a very positive shift in the real estate

Observing all of the above, 2014 certainly is a very fruitful year for the real estate of Bangalore. Though the overall market scenario in the real estate sector is improving this year, Bangalore has an edge over the other markets and there is much to happen in the property market that will add to the stability and growth of it. 

With this positivity and rising demands, Bangalore is topping many lists and buying trends in the city are going higher and higher. The maximum use of office space by the industries that invite professionals from round the world is the key point that generates demand.