Bangalore has been the fastest-growing city of
India since the past few decades. IT has been the major growth driver
and is responsible for aggressive real estate development in the city.
Bangalore has a multi-cultural population with good social
infrastructure, excellent educational institutes and constantly
upgrading physical infrastructure. Currently, the most promising
residential micro-markets are Outer Ring Road (ORR), Sarjapur Road,
Whitefield and northern parts of the city.
Luxury Residential: Bangalore is the third-largest hub for high net
worth individuals (HNIs). It is estimated to be home to over 10,000
individual dollar millionaires and has a large base of expatriates.
There has been increased demand for high-end residential apartments in
the city, particularly in the central business district (CBD), secondary
business district (SBD), Whitefield, north Bangalore and Outer Ring
Road (ORR) sub-markets. This demand is expected to be steady over the
short-term.
Bangalore is one of the most promising markets for villa projects in
India. Villa and row house developments are most active in the north,
ORR, Sarjapur Road and Whitefield micro-markets.
Mid-Income Housing: This segment is mainly driven by individuals
working in the IT and ITeS industry. The main driving factors for this
segment are social infrastructure, proximity to workplaces, good
physical infrastructure and access to medical and educational
facilities. Micro-markets such as Whitefield, the ORR IT corridor,
Electronic City and few areas in north Bangalore have witnessed a steady
demand from the mid-income segment.
Affordable Housing: The demand from this segment comes from extremely
price sensitive buyers — therefore, affordable projects are developed
in the suburbs as these areas offer large land parcels at lower
acquisition costs. Areas such as Mysore Road, Hosur Road, Kanakapura
Road etc. have witnessed high demand for this segment.
The affordable housing concept has gained ground in Bangalore mainly
due to a few graded developers like Purvankara, Brigade Group, Shriram
Properties, Golden Gate Properties, Ozone Group and Nitesh Estates who
are focusing their projects for this customer segment. In most cases,
housing units are made affordable by reduced sizes, compromising on
civic amenities and other USPs which were typically provided as
differentiators to the competing projects.
Further, the planned Metro Rail and Peripheral Ring Road have
increased the demand on the outskirts of Bangalore. VBHC Attibele and
Patel Neo Town in south Bangalore, Provident Welworth and Sovereign
Lakefront in the north of the city, and Provident Sunworth and VBHC
Kengeri in west Bangalore are some of the affordable housing projects in
the city.
With increased demand, ‘affordable’ housing projects have witnessed
an increase in capital values and are now priced higher than or similar
to mid-income projects. These projects have also seen substantial rise
in capital values because of increased cost of land acquisition and
construction.
Developers have therefore resorted to redesigning their projects to
address the demand of a wider target segment looking at the budget homes
category. Major national level players and local developers have plans
to enter the affordable housing segment of Bangalore. These include Tata
Housing, Usha Breco Realty, Godrej Properties, Ashoka Group, Jannaadhar
Construction, CSC Builders, Brigade Group, etc.
Overall Demand Scenario: The Bangalore market saw absorption of 6,519
units in the second quarter of FY’13 against 6,689 units in the
previous quarter. Unsold stock in during the quarter totalled 50,184
units as compared to 46,823 in the previous quarter, reflecting a
vacancy rate of 53.4 per cent, down from 54.2 per cent the previous
quarter.
Supply: A total of 21 residential projects were launched across
Bangalore in the second quarter, offering 9,889 units against 10,009
units in the previous quarter. Meanwhile, eight residential projects
comprising 2,319 units in various sub-markets were completely sold out.
The major projects launched during this period included Prestige
Sunrise, Prestige Ivy Terraces, Shriram Sameeksha, Sobha Santorini and
Brigade Begonia.
CBD & SBD: Low supply and high demand. Due to low availability of
large land parcels and high capital values, these micro-markets have
seen a limited supply of residential developments. These markets have
very good social and physical infrastructure. Nitesh Park Avenue,
Prestige Kingfisher Towers, Westcourt Cityview, ETA Beau Monde, 77
Degrees East, Sobha Indraprastha and Prestige Edwardian are some of the
high-end projects in these micro-markets.
http://www.indianexpress.com/news/bangalore-realty-on-expansion-mode/1190104/0