The sale of housing units sees an increase in 2022 with 58,000. The last real estate boom in bengaluru was in 2014-15.
Housing sales in Bengaluru for the year 2022 have hit a new high for the first time after eight years. The last real estate boom in Bangalore was in the year 2014-15.
Ghar tv, a property advice platform which brings out yearly reports shows that in 2009 more than five cities were ahead of Bengaluru on the list of the country’s top real estate markets. However, in 2015, Bengaluru was the country’s leading real estate destination, beating Mumbai, Pune, Thane, Noida and Chennai, which were ahead of it in 2009.
Dr S R Keshava an Economics Professor at Bangalore University said that in 2014 and in 2022, Bengaluru had the highest GDP growth rate .“At that time there was an increase in middle class population. The capital investment ratio increased and all this contributed to the growth in economy and real estate sales.”
In 2021, around 38,000 housing units were sold in Bengaluru. Moneycontrol reported that by the end of the third quarter of 2022, Bengaluru’s housing units’ sale stood at 58,900 units.
Dr Keshava said that most of the economic indicators like consumption, expenditure, employment levels have now reached pre-covid levels. “Employment generation is happening at a larger level now, because of which the income and consumption level is increasing and people are investing in real estate like houses or office spaces.”
A report by 99acres, a real estate agency shows that the city recorded enquiries for houses ranging between Rs 25 lakh and Rs 80 lakh in areas such as Mysore Road, Rajeshwari Nagar, Attibele, Sarjapur Road, Devanahalli, and Hoskote. Other areas like Yelahanka, Whitefield, Thanisandra, Kadugodi, KR Puram and Electronic City garnered maximum enquiries for homes starting from Rs 80 lakh.
The report also shows that in Bangalore’s luxury house market, areas, like Hebbal, Whitefield and Jalahalli were the hotspots. These houses cost Rs. 1 crore and above and a starting price of Rs 6,000 per sq ft.
Real estate firms agree that there has been a boom in the sale of housing units in the year 2021-2022, the first time in eight years since 2014, the previous real estate boom.
Many industries rely on the real estate sector for job opportunities. Dr Srinivas, an Urban Planner said that industries that rely on this sector in an urban setup where vertical construction is on the rise. The sales and the requirement of the industries that rely on the real estate sector have shot up. He added that the water, and energy requirements need to be met.
A designer at a kitchen furnishing company said, “When the sales of houses go up it benefits us and many furnishing and other industries. People who buy houses invest in furnishing them rather than those that rent them.”
Dr Keshava said, “It is beneficial for the economy of the state as the real state sector multiplies assets and rejuvenates 40 plus industries like the steel, cement, carpentry, decor, plumbing, and plastic industries.” He added that the demand, income, and employment were increasing because of the real estate sector sales.
Experts say real estate is a good investment and boosts economic growth. An interested homebuyer said, “Bangalore being the IT hub brings so many people into the city and they look for houses to rent or buy based on their current financial situation.” She also said that Indians have always been taught that property is a great place to invest in other than gold.
Dr. Keshava said that people stored money as a precautionary measure. “After the pandemic people who didn’t buy any properties in the COVID years suddenly started using the money they had stored to buy houses that could be a major cause of the boom in 2022.”
Bengaluru’s land has crossed its limit and cannot take any more of this overcrowding said Dr Srinivas. He added that the rise in the sale of houses brings with it a whole slew of issues. “Bengaluru is not equipped to handle all the needs of the people. Transportation is affected as more of it is required to cater to the heavily populated areas now. Then the underground drainage and water system will be overwhelmed and many other such problems that come with an increase in people and a shortage of land and resources will occur.”
Dr Srinivas explained that the conventional horizontal construction is now replaced with vertical development based on the current requirement. “An alternative needs to be found as the infrastructure does not support the huge volume increase requirement that is caused by the vertical construction. The impact to the city is very real,” he added.