Despite the positive trends in Bangalore’s real estate sector, challenges remain that could impact future growth. The market is currently experiencing a cooling period after a significant uptick in property prices over the past few years.
Declining Sales Volume
Recent reports indicate that residential sales have decreased significantly, with approximately 15,000 units sold in Q3 2024—a decline of 8% compared to previous quarters
. This downturn can be attributed to several factors:
- Affordability Issues: As property prices continue to rise, affordability has become a pressing concern for many potential buyers. A large proportion of transactions are now concentrated in the under ₹1 crore category, reflecting the middle-class preference for more affordable housing options.
- Stagnant Rental Growth: The rental market has also seen a slowdown, with rental inquiries dropping by about 20% in prime areas like Indiranagar and Koramangala. This stagnation follows years of rapid rental increases driven by high demand.
Market Correction
Industry experts anticipate a correction in property prices due to the oversupply of new units coming onto the market. While this could alleviate some affordability concerns, it may also lead to increased competition among developers and potentially lower profit margins in the short term.
Future Outlook
Looking ahead, the outlook for Bangalore’s real estate market remains cautiously optimistic. Continued infrastructure development, including metro expansions and improved connectivity, is expected to support long-term growth. However, stakeholders must navigate the current challenges carefully to maintain momentum in this dynamic market.
