With the easing of the economy due to the gradual process of unlocking, the residential real estate market of Bengaluru has scaled back to normalcy as searches for property grew by 47% in the July–September quarter after witnessing a fall of 14% during the April-June quarter amid COVID lockdown, reports the latest Magicbricks PropIndex Report for the July-September 2020 quarter.
A clear demand shift towards affordable housing was witnessed during the September ending quarter, as searches increased for properties costing less than Rs.5,000/ sqft. However, home buyers are retaining size preference but reducing budgets to move to the periphery regions as revealed by the Magicbricks PropIndex Report.
Interestingly, the decline was witnessed in the sub-Rs.7000/sqft price buckets. Under Construction properties continued to be sluggish and posted a 1.5% price dip in Q3 2020. Overall price decline arrested to just 0.5% in Q3 2020 post the onset of unlock process.
Commenting on the PropIndex report, Sudhir Pai, CEO, Magicbricks, said, “The next 6-8 months are crucial for the revival of residential sector. The onset of the pandemic and the ensuing lockdown have changed consumer preferences. Today, the shift is towards affordability as home buyers have reduced their budget but they haven’t changed their preference in terms of BHK or size, they are moving towards the peripheral regions. With the festive season just around the corner, we are witnessing a sharp recovery in demand and prices have remained stable for the July-September quarter. This augurs well for the industry and we hope consumers’ buying sentiment will continue to improve and translate into transactions in the coming quarters.”
It is interesting to note that Bengaluru has a healthy market for most BHK configurations, with demand matching supply. The market is well distributed between affordable and mid-sections, with 2 and 3 BHKs having the largest share of demand and supply, while 1 or greater than 3 BHKs taking up ~10% of the pie. It was observed that Mid-segment configurations (2 & 3 BHKs) continued to drive most traction, and accounted for more than 90%.
Whitefield, Sarjapur Road and Bellary Road continue to be the top 3 micro-markets of Bengaluru due to continuous IT development in the region and the upcoming metro facility. The upcoming metro line in Kanakapura Road has led to a significant rise in demand in Q3 2020. The development of new office spaces such as Amazon and Apple is likely to boost residential demand in close proximity areas.