Bengaluru’s early start as a tech city and its favourable weather paved the way for the expansion of its residential sector. While the city has been standing out in pan-India residential launches and sales, property prices initially increased at a moderate pace, making the city’s residential real estate relatively affordable.
Bengaluru’s residential sector has transformed remarkably post-pandemic, with average city-level property prices growing by 8–10% in 2022 and by an average of 15–16% during 2023. This rising trend continued in H1 2024, with a 14–15% y-o-y hike in capital values. Beyond accelerating land and construction costs, Bengaluru’s residential hubs have shown strong price growth driven by healthy supply and demand catalysts.
Among the many pockets of development in the city, certain areas have outpaced others in terms of property price increases. While posh localities of Koramangala, Indiranagar and Rajajinagar continue to maintain their premium status among high-net-worth individuals, prominent residential hotspots around Whitefield and Sarjapur Road in the eastern quadrant and Hennur-Thanisandra Road and Yelahanka in north Bengaluru have experienced a repositioning in their market dynamics due to a noticeable appreciation in launch prices and average ticket price of apartments, post 2022. This has been particularly evident during H1 2024. This upward shift is also an outcome of notable demand for spacious units, particularly 3BHK and 4BHK configurations.
Table 1: Upward shift in average ticket price in residential hotspots of Bengaluru
Source: JLL Research, Q1 2024
*Prevailing average size of apartments in Bengaluru: 2BHK -1000 to 1200 sq. ft; 3BHK – 1600 to 1800 sq. ft.
**Increased Average apartment sizes in these markets in H1 2024: 2BHK – 1300 to 1400 sq. ft; 3BHK – 2000 to 2200 sq. ft.
Over the past couple of years, these locations have emerged as focal points of housing demand driven by their proximity to tech parks, educational institutions, transport hubs, medical facilities, as well as apartment sizes, and amenities offered. Capitalising on the increased demand, these locations have seen significant launches by reputed developers at higher rates, resulting in exponential price growth and a surge in the average ticket price.
These locations have undergone significant change in a relatively short span and are likely to remain sought-after residential and investment destinations in Bengaluru’s real estate market. Metro network expansions, continued growth in the city’s tech sector and the launch of tech-enabled and sustainable upscale projects are expected to drive property launch prices upward, resulting in a dynamic shift in the prominent residential hotspots and Bengaluru’s overall residential landscape.
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