Bengaluru witnessed a 6.9% quarter-on-quarter increase in new housing units in the first quarter of 2021, according to the latest Magicbricks PropIndex. According to the report, this was due to the opening of the economy and the resumption of construction. It also said that most of these new properties are concentrated in the city's eastern and southern outskirts.
According to the report, both the Under-Construction (UC) and Ready-to-Move (RM) property segments saw positive price changes, but the UC segment saw greater gains in Q1 2021. ‚ÄúThe dynamics of the Bengaluru residential market were bolstered by factors like improved affordability resulting from lower home loan rates and various developer-led initiatives like cash deals, discounts, and deferred payment plans. Reflecting the dominance of mid and upper-mid segment buyers in the city, 2 and 3 BHKs account for 90% of the demand and 92% of the supply in Q1 2021," the report states.
Despite a heightened preference for multi-storey apartments in the past, buyers are now searching for larger homes within their budget, according to the report, which is what is driving up demand for residential plots and villas on the outskirts of the city. Whitefield, Sarjapur Road, and Bellary Road consistently ranked high in terms of searches as well as active listings, the report adds.
Magicbricks PropIndex also states that the ready-to-move segment, in Bengaluru, posted a marginal quarter-on-quarter growth of 0.7% but still declined on a year-on-year basis at 3.3%. Due to revived confidence, the under-construction (UC) properties witnessed an increase in prices by 1.3% quarter-on-quarter. Although, both types of properties witnessed price increments across all price segments.
‚ÄúProperties costing more than Rs 7,000 per sqft occupied a significant share of 36% in the demand pie, which increased from 32% in Q4 2020. The demand for mid-sized homes has propelled the share of 2 BHK configurations even as the share of 3 BHKs has come down by 5% of the overall pie over Q4 2020," the report states.
‚ÄúVarious confidence-building measures by the central government such as liquidity infusion in stressed projects through the SWAMIH fund and RERA extensions have supported the sector when most needed. Reduced home loan interest rates along with cuts in stamp duties in some states have improved the demand. From the price perspective, the southern region witnessed the most price increments in Q1 2021 in both under-construction and ready-to-move segments. We foresee the momentum gained in the last six months to continue across both supply and demand,‚ÄĚ according to Sudhir Pai, CEO, Magicbricks.