Bangalore real estate cooling off
After seven years of hectic activity, the Bangalore real-estate market
is hesitant, perhaps more on the part of bulk investors than serious
home buyers. Blame it on the rising inflation or the economic crisis in
the US. Like other locations, Bangalore real-estate, termed ‘hot’ by
leading realty consultants, seems to have cooled off in the last few
months. Though property prices have not seen a dip, home sales has come
down “at least by 50 per cent”, say consultants. Certain Grade ‘A’
developers have experienced a sustained drop of around 50 per cent on
the monthly level of bookings compared to what they enjoyed prior to
December 2007. First-home buyers, it seems, are still interested in the
market, though it is the second- or third-home buyers who are shying
away. However, reputed developers offering homes in booming locations
in the city are still selling. In fact, some of them have upped their
pricing by 3-7 per cent, with South and South-West homes costing 3-5
per cent more. In the North of the city, prices have gone up by 8-12
per cent. Many indicate that this is a correction phase and not a crash
as witnessed in 1996. The market currently is more need-based and
mature; there’s no need to panic. There’s a 10 per cent more supply
than demand in the market now but this should get absorbed by the last
quarter of 2008-09.Its expected that the prices will head north again
in the third and fourth quarters, and recommended that the buyers
should make their deals then. According to the Cushman and Wakefield
report, capital values appreciated marginally by 1-2 per cent across
micro markets in January-March 2008 on account of increasing demand,
primarily from a migratory and working population. It is expected that
both capital and rental values in the city will continue to stabilise
during the next few months across select micro markets (Whitefield,
Kanakapura Road, Outer Ring Road) with a large number of
investment-based properties expected to see softening of rates over the
next six months.
riathareja
riathareja
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