Luxury property units seem to have resurrected as a favoured residential option for potential house buyers in Bangalore. According to Square Yards research, demand for these luxury housing units peaked in Q1 2022. Let’s look at some credible reasons to give ground for this consistent hike in the demand for luxury residences.
Bangalore’s luxury housing market has seen a considerable surge in demand in the last couple of years and it has been particularly visible since Q4 of 2021. Despite the pandemic-instigated economic crunches and employment insecurities that had a clamant impact on the realty sector, Bangalore’s online luxury unit search trends for 2022 sustained as a beacon amidst a bleak reality. The continuation of the remote work culture has resulted in a heightened demand for 3BHK and above configurations in luxury homes in Bangalore.
Following the pandemic, an inclination of homeowners’ choices to a holistic lifestyle was witnessed, prioritising both sustainability and well-being. Recent real estate trends have also demonstrated that southern cities prefer larger (above 4000 Sq. Ft.), self-contained residences. Bangalore alone contributed a major chunk of (more than 30%) the total demand for luxury property units in Q4 2021 and Q1 2022 when compared with the top five cities of India, including MMR, Pune, Hyderabad, Gurugram and Noida.
Even though several builder floors, flats, plots and luxury villas are available throughout the city, independent houses captured about 42 percent demand share. This also indicated a rising preference towards the more privacy-induced and spacious luxury properties in Bangalore.
Now, the question is: Will this public demand for luxury houses in Bangalore continue in 2022 and beyond?
Square Yards’ research dived deep into the behaviours of prospective home purchasers for larger house searches, yielding some interesting results.
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Demand Trends for Luxury Home Configurations
While space has always been an intrinsic factor governing home buyers’ preferences, what changed is that despite the availability of 3BHK and 4BHK apartments, more people started gravitating towards independent houses, heightening the trend of luxury homes in Bangalore in Q1, 2022.
A demand-supply analysis conducted by Square Yards revealed that the demand for independent houses during that time was about 42 percent against plots (21 percent) and apartments in Bangalore (18 percent).
This not only gives us a peek into the buyers’ demographic patterns but also their evolving homebuying preferences.
While the demand share for luxury homes reflects the upper-middle class demography constituting nuclear or joint families with steady income, the specific rise in the need for independent houses indicate the buyers’ strong desire to purchase multi-storied, well-facilitated and gated properties, providing them utmost ownership and privacy.
Additionally, given the multicultural working populace of Bangalore, independent houses may also prove to be a lucrative opportunity for realty investors to put it up for short-term and long-term rent.
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Most Searched Budget Range for Larger Houses
According to Square Yards research, online searches for luxury houses worth Rs 1 crore and above had the highest demand share of almost 40 percent in Q1 2022, with the Rs 1-3 crore bracket capturing a major chunk of 33 percent. Several reasons could have affected such a luxury housing unit search behaviour.
To begin with, although the majority of prospective purchasers were aware of the higher price range of larger homes, reduced home loan rates may have fostered the optimism in them to go ahead.
Home loan rates have dropped significantly from nine percent to seven percent since 2019. Some banks are already giving housing finance services at as low as 6.50 percent, making real estate purchases more accessible than ever.
A heightened preference for well-facilitated properties in prime locations could have also been another reiterating influence. This is mainly because most of the working population is concentrated in and around well-connected urban areas, especially near employment and commercial hubs.
Top 5 Most Searched Locations for Luxury Homes in Bangalore
Whitefield, Bagalakunte Mallathahalli, Nagarbhavi and Malleswaram were the most searched localities in Bangalore for luxury properties (Rs 1 crore and above). Here is a breakdown of the most searched locations in Bangalore for luxury homes.
Whitefield
Whitefield is one of Bangalore’s most affluent locations, home to a slew of prestigious IT firms, multinational corporations and international technology parks. In view of the fact that Whitefield is less bustling and well connected to the rest of the city, it captivates a steady home demand. Located in East Bangalore, Whitefield is well-versed in a variety of completed and upcoming premium residential projects.
The presence of numerous educational institutions, hospitality services, entertainment outlets, and the upcoming metro links is one of the main reasons for the rapid growth of residential properties in this area. This neighbourhood’s luxury residential landscape includes ultra luxury villas in Bangalore, independent floors, townhouses and apartments in various configurations, which is one of the reasons why individuals chose this location for premium property purchases in Q1, 2022.
Bagalakunte
Bagalakunte is located in the northern part of the city and is home to prominent independent houses, apartments and builder floors. Tumkur Road and Hesarghatta Road are the major roadways that offer effortless connectivity to the rest of the city. Well-developed social infrastructure, the plethora of educational institutions and medical facilities make it an favourable investment destination.
According to Square Yards data, Bagalakunte is one of the most popular locations for luxury properties in Bangalore, particularly for 3BHK and larger configurations. It is a great location for investment opportunities with high returns due to the existence of smart infrastructure and neighbouring employment hubs such as Manyata Embassy Business Park and World Trade Centre.
Mallathahalli
Gone are the days when only East Bangalore was considered an expensive locality. Even suburban areas such as Mallathahalli are now included in the list of prominent locations for real estate. The Mallathahalli Lake is a major attraction for homebuyers in this locality. Due to its proximity to its magnificent lake view, Mallathalli had emerged as one of Bangalore’s most coveted neighbourhoods in the first quarter of 2022. It provides excellent access to the city’s southern reaches.
Along with this, there are also a number of world-class educational institutions, including AIBM College & Rajiv Gandhi Memorial Polytechnic College. It nestles a great deal of malls, shopping outlets, entertainment venues and other attractions. The presence of international corporations and IT hubs is further cited as a major factor in the area’s residential growth.
Nagarbhavi
Nagarbhavi is an upmarket residential locality near the western outskirts of Bangalore. From well-connected roads and residential complexes to corporate centres, this affluent location has it all. The Nagarabhavi main route is lined with major restaurants, cafes, entertainment outlets, and educational institutions. Easy-to-reach daily amenities make it a perfect spot for the home-buying audience.
The rising residential demand for luxury units in Nagarbhavi is primarily due to the locality’s excellent connectivity. However, being a fully developed landscape, there is little room for new residential projects in this area.
The few plots that are available makes the demand for them more competitive as buyers who want to build their homes on their own land perceive Nagarbhavi as a good catch. With less supply and more demand, the price elasticity for plots in this area is significantly heightened, ranging between Rs 51 lakh to 5 crores.
Malleswaram
Situated in the city’s northwestern outskirts, Malleswaram is one of Bangalore’s oldest localities. It nestles prominent IT hubs such as World Trade Centre, Embassy Manyata Business Park creating a perfect blend of the old with the new. State-of-the-art infrastructure and easily accessible world-class amenities make Malleswaram one of the most coveted residential areas in Bangalore.
It is exclusively abundant with independent housing units, contributing to the 42 percent demand share for the same in the first quarter of 2022. The locality is ideally connected to the rest of the city via excellent road connectivity through Sampige Road and Margosa Road and top-notch metro connectivity. Malleshwaram’s popularity stems from its tranquil atmosphere, rich greenery, and accessibility to the city’s major attractions.
Like Nagarbhavi, the presence of fewer luxury plots here also contributes to a heightened price elasticity via competitive demand against limited supply.
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With sentiments of owning an opulent home in a spacious residential unit in response to COVID-induced issues gaining traction, the idea of luxury home appears to be a prudent preference for home-buying audiences. And, until realtors come up with more acceptable offers, such as residential units that are modified and designed in accordance with the needs of the homebuyers, this transient desire for luxury dwellings and independent residences may continue to drive demand in the residential markets of Bangalore in the future months.
