Bangalore has surpassed bigger property markets such as Mumbai, Delhi and Chennai with 140 percent growth in the last quarter. The sales in the other big cities have languished. The property sales in Mumbai Metropolitan Region decreased by 60% at 15.98 mn sq ft while the NCR fell by 57% at 28.86 mn sq ft. Bangalore, on the other hand has picked up pace, with staggering percentage growth, 15.58 million sq ft of residential space was sold in the city in the first quarter for the current fiscal year, giving it a total market share of 13.9%, PropEquity said.
“Bangalore is witnessing higher off take compared to other bigger realty markets in the country despite challenging times,” said Pirojsha Godrej, managing director and chief executive officer of Godrej Properties, which is in the process of launching projects totaling 4 million sq ft over the next few months.
The reason of growth in the Bangalore’s real estate market is the higher percentage of end users and the relatively moderate price rise, experts said. While the drop in the Mumbai and Delhi is mainly due to increase in home loan rates and increased property prices, Bangalore also has the added advantage of being the IT hub of India which in turn profits the city in terms of real estate.
According to the Confederation of Real Estate Developers Association of India (CREDAI), new launches in the bigger markets of Mumbai and Delhi have fallen by 50% and 57%, respectively. “Lack of project approvals has restricted new property supply. Additionally, the number of home loan application has gone up to 40-45% as loans are now being disbursed excluding stamp duty, registration and other taxes , thus impacting sales,” said Lalit Kumar Jain, president, CREDAI.
“NCR has seen a drop in home sales because work in Noida extension was stalled for many months. The Noida region was also impacted because of elections in Uttar Pradesh,” said Sameer Jasuja, chief executive officer at PropEquity.
The new launches in many parts of NCR and Mumbai ranges from Rs.7, 000-10,000 per sq ft while Bangalore didn’t increase prices much and hence the new property costs around Rs.4, 000 per sq ft (comparatively lower than Mumbai and NCR).
The Bangalore property market has played well, topping in both sales as well as the loan sanction and disbursement.