Housing sales in Bengaluru have dipped by 2% to 13,133 units from 13,390 units in the year-ago period due to a reduction in sales in the affordable category even as the office demand in the IT city remained flat at 3.5 million square feet, a report by Knight Frank has said.
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“The less than ₹50 lakh housing segment saw sales decline by almost 65% to 70% in the first quarter of 2024 which has brought down the overall numbers. The sales in the ₹50 lakh- ₹1 crore residential segment has dipped by 7 percent. This is primarily on account of the affordability challenges faced by buyers of this segment. This may be a temporary blip,” said Vivek Rathi, head of research at Knight Frank India, at the launch of the Knight Frank titled India Real Estate: Office and Residential Report (January – March 2024).
Having said that, sales of houses in the more than ₹1 crore segment has gone up by almost 50% despite the taps running dry in the city, he added.
Read More: Luxury homes priced above Rs 50 cr see remarkable increase in sales
Asked if the water crisis in Bengaluru has had an impact on the real estate market, Shishir Baijal, chairman and managing director, Knight Frank India, told reporters that the “ water crisis has not had too much of an impact on the housing sales trajectory and cannot be attributed to the decline in sales or the market performance. Having said that, the issue has to be sorted as Bengaluru is an important commercial market and a favorite city for office space occupiers. It is the commercial leasing capital of the country. Government bodies will have to get around to resolving the water issue,” he added.
This is how the housing sales numbers stacked up in Bengaluru
The residential market of Bengaluru witnessed a total residential sales volume of 13,133 units and 13,135 units were launched in the period with an annual growth of 9% YoY in Q1 2024. The average weighted residential price witnessed an increase of 9% YoY which was the second highest across the eight Indian cities during Q1 2024 with a value of ₹6,145 sq ft, the report showed.
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During Q1 2024, as many as 993 units were sold in the less than ₹50 lakh category which was a decline of 68%; 6065 housing units were sold in the ₹50 lakh to ₹1 crore category which was a 7% decline in sales in the category and 6075 units were sold in the ₹1 crore plus category which was an increase of 50%, the report showed.
Bengaluru records office space transactions of 3.5 mn sq ft in Q1 2024
Bengaluru has recorded office space transactions of 3.5 million square feet (mn sq ft) in Q1 2024. The IT Capital of the country spearheaded the commercial market growth and constituted 22% of 16.2 mn sq ft of transactions across leading eight Indian cities, the report showed.
Office completions in the city grew by 275% to 5 mn sq ft in Q1 2024 from 1.3 mn sq ft in Q1 2023. Bengaluru accounted for nearly 38.46% of new office completions across leading eight markets of the country.
During Q1 2024, the major occupancy/leasing activity in the city was driven by Global Capability Centres with 51% attribution. The Global Capability Centres (GCC) oriented transactions in the city have increased by 38% YoY from 1.3mn sq ft in Q1 2023 to 1.8mn sq ft in Q1 2024.
Flex office areas accounted for 26% to city’s leasing activity which was followed by India-facing business and Third-Party IT Services at 14% and 9% respectively, the report said.
