Investors have always focused on the Silicon Valley of the country, Bangalore, particularly the NRIs for lucrative options. The place is one of the fastest growing cosmopolitan cities and hub of commercial and industrial properties. This leads to giving a major boost in the infrastructural development in the city. In this post we will be discussing about the real estate scenario and rental market in Bangalore.
The demand in Bangalore for residential property is higher than the supply. The demand is huge because of the massive growth in the industrial and commercial sector which has generated lot of employment opportunities in this place. This is the reason the residential sector is not braced up to accommodate the so many new migrants.
Demand of Rental Properties in Bangalore
To meet the demands, there are various new projects developed by the leading real estate developers. There are many new residential projects coming up in the city’s eastern and southern regions of Outer ring road, Whitefield, Bannerghatta Road, Airport Road and JP Nagar. If we go by the present trends then the demand for luxury apartment and villas have increased to a great extent. Large number of IT professionals and NRIs are looking for these accommodations. As per the real estate experts in Bangalore, the rental and capital values are likely to increase and any sort of investment will result higher returns in the coming years.
The rental properties include office space, independent houses, flats, apartments and bungalows. Many of the companies provide accommodation for their staff. One can get commercial property, industry property, storage space, retail space on rent for business purpose and office space for rent in Bangalore.
Even banks are coming out with few innovative schemes and offering loans to those who have leased/rented their properties to insurance company, embassies, banks, multinationals, PSU, etc.
In recent years, large numbers of people are migrating to Bangalore and that has led to increase in rentals in Bangalore. Usually, people who own more than one house prefer to give the second one on rent, usually the tenants are students or executives. If we compare the rent prices, it is found that they are more in the city than in the outskirt areas. According to a recent survey, properties in South Bangalore were in demand for rental purposes, which was followed by northern and eastern Bangalore. The demand in southern part of the city is almost double the demand in Bangalore north and three times more than the demand in Bangalore central, but there has been a drop in rent rates of about 10% because of the present global recession.
Demand for Commercial space
It is expected that the Bangalore office market will absorb about 8 million square feet by the end of this year because of the demand from ITeS/ IT sector. The city has witnessed and upsurge of 118% in the second quarter of this year over the first quarter. However, there was a drop of about 28% if we compare it with the second quarter of last year. Maximum demand was from the ITes/IT sector.
According to the research by Knight Frank, property consultants, the absorption of commercial space in Bangalore was 105 million square feet till date. There are plenteous IT companies in the city which are adding to the demand for rented accommodation. The new commercial property projects are offering many facilities which include entertainment room, playing area, gym, food court, parking, etc. but they are located on the outer ring road area of Bangalore as those lands are easily available to the developers.