APPD Market Report Article
BengaluruMay 31, 2022
Sales for high-end homes lower 12% q-o-q
- Buyer sentiment for high-end properties remains upbeat for both completed and ongoing projects. The luxury homes market has been buoyed by attractive pricing, a rise in homeownership sentiment, Non-Resident Indians (NRIs) and those looking to upgrade to better and bigger homes. Even investor activity for select projects is being observed, with the potential for price appreciation as a key driver.
- While the luxury market is still ruled by the preference for ready-to-occupy properties, new projects by well-known players are also garnering healthy interest. Most buyers are still wary regarding promises and want to look at ready properties or those by established developer brands.
New apartment launches surge in the quarter
- Bengaluru witnessed a rise in new luxury home launches in 1Q22, with leading developers announcing new projects during the quarter, driven by rising demand for such homes. Major project launches were recorded in the secondary submarket followed by Bellary Road and Hosur Road.
- Some of the major launches by reputable developers, like Birla Estates, Sobha, and Mana, among others, were the most active during the quarter in terms of sales activity.
Overall capital values increase 1.5% q-o-q
- Capital values rose slightly when compared to the last quarter, mainly due to an increase in the price of raw construction materials, like steel and cement, and sellers passing some costs on to the buyers.
- Rents continue to remain stable during the quarter. While the effects of Omicron were mild, most IT employees continue to remain away in their home towns and, hence, rents remained largely unchanged.
Outlook: The high-end market to continue its growth in 2022
- New launches are expected to increase in the medium term with developers launching large-sized houses and apartments to capture changing consumer preferences in the post-COVID-19 era.
- The peripheral areas are likely to emerge stronger, as the hotspots of new launches, and associated buyer demand is driven by infrastructure development.