Brigade Valencia

Bangalore Real Estate Market

A new home development called Brigade Valencia will soon hit the Hosur Road, Bangalore real estate market. We have been anticipating applying what we discovered in 2020 in 2021. The year 2020 was filled with self-reflection, making positive, long-lasting changes in life, and developing habits that are great for our mental health. This was happening as nature was purifying itself from the contaminants it had been exposed to for years.

For the first time in a long time, we were able to spend more time with our family.

We were aware of the need for vital workers, such as those employed in supermarkets or grocery stores, even when the area was under lockdown. We started to walk more, exercise more, and eat better. Because there were fewer cars on the road, the air quality in big cities like Bangalore, Chennai, and Delhi improved. We realized that the best location to unwind is unquestionably our own homes since taking virtual tours and participating in zooming calls became part of our daily routine.

Every market that has endured the worst of the lockout, restrictions, and monetary and emotional losses is gradually coming to terms with the new situation. Following the end of the shutdown, some markets started trading again right once, while others took their time and gradually returned to business as usual.

The vaccine must be accessible, yet the hazard is still present. Numerous cities are still on the verge of going into lockdown due to an increase in incidences of people not abiding by the rules. As a result of job losses across industries due to almost no demand from customers, businesses have failed and entrepreneurs have failed.

India now has a 6.5 percent unemployment rate. This is an increase from the 9.1 percent in December 2020. The confinement and lockdown had a disastrous impact on people's mental health, resulting in issues like stress, worry, and despair. The service sector and tourism, which are both important drivers of the economy, suffered the most during the outbreak.

The second most affected industry was the hospitality sector. The commute was halted since businesses and educational institutions were closed, which affected public transportation nationwide, including trains, metros, and taxis.

The real estate market was already dead after demonetization, GST, and RERA. Karnataka got 850 applications for new real estate projects in 2019 as a result of the onslaught of company crackdowns, but the boom slowed in 2020 with only 540 new project registrations. There was a lot of demand in some locations prior to the covid-19 breakout, but less so presently. Yelahanka, Hebbal, and RT Nagar are among the places where homebuyers have shown increased interest. On the other hand, places like Whitefield, Electronic City, and Marathahalli remain unaffected.

It is plausible to suppose that the Covid-19 pandemic affected the already moribund Indian real estate industry and the sectors that support it most severely in the first quarter of 2020. All industrial and building activities came to a complete stop between March and June due to an almost three-month shutdown, or was at the very least postponed indefinitely. The same applied to real estate. However, until the lockdown was lifted, which was not in the near future, unorganised sector workers and labourers started moving back to their hometowns to be nearer to their relatives.

Because it is the second largest employer in the nation, the government gave the struggling real estate sector primary priority during the partial government shutdown. Financial institutions like banks and NBFCs lowered interest rates on home loans as the demand for completed projects rose to entice consumers to buy their dream homes in their preferred neighbourhood. People started to perceive flats as more than just a set of walls with doors as the desire for completed buildings grew. They started to think of apartments as potential work spaces. As a result, there has been an increase in demand for apartments with two and three bedrooms.

The RERA deadlines were taken into consideration, and a six-month extension was granted. The Karnataka government reduced stamp duty for new housing developments from 5 percent to 3 percent for properties valued under 35 lacs. For houses priced under 20 lacs, the stamp duty fee was reduced to 2 percent.

It advised banks and other financial institutions to allow present clients loan moratoria. New buyers will be drawn in, and their faith in financial institutions will be rekindled.

Real estate changed from being physical to being digital during the lockdown. Digital meetups and video tours were created with the social distance concepts in mind, lowering travel expenses and enabling clients to take video tours in any location of their choice.

In comparison to Ahmedabad, which has 38,614 unsold residential units as of December 2020, Bangalore had 71,198. In 20% of cases, unsold inventory can be classified as ready-to-move-in units. With 17,793 new project launches and 23,458 units sold, the real estate market in Bangalore experienced the best recovery among the top eight real estate markets in the nation.

Due to cheap borrowing rates and reasonable flat price from buyers on completed complexes, Karnataka had the lowest inventory overhang. 30 percent of the unsold product was produced in Bangalore.

Many corporate workers used the shift in workforce as an opportunity to return to their hometowns to work from home and save money on rent, which many did. As a result, rents in prominent areas have decreased. HSR layout has lost 5% of its value, whereas Indiranagar has lost 11%.

The physical infrastructure of the city has always been an issue, and the pandemic only made matters worse by putting a stop to significant metro construction projects that would have otherwise laid the framework for people to purchase new homes in regions with better connectivity. The labourers and employees brought an ambiguous and unforeseen shift back to their country of origin.

While many prospective purchasers have chosen to wait it out and regularly monitor real estate prices in their preferred locations, others have made investments to upgrade their properties at home, embracing the new normal. Delays in metro line projects and the possibility to work from home are two more issues that have contributed to Bangalore's poor liveability index and home buyers' aversion to buying residences. People are moving to the periphery of the city due to traffic issues in places like Electronic City, HSR layout, and Silkboard, which forces them to work remotely from home. Overall, Bangalore real estate continues to do better than those of other sizable cities like Mumbai and Delhi. Forecasts indicate that leasing operations will improve in 2021. Offices are reportedly operating at full capacity, with some even beginning to function with only 30% of their staff. Many would prefer to own villas or separate dwellings with gates for improved protection and to ensure that social distance standards are observed.

Read more:

Real Estate in Bangalore

2023 Real Estate Trends