Realtors put it down to the fact that demand for houses outstrips supply in central Bangalore. But the good news is that rents elsewhere are moving south
Realtors put it down to the fact that demand for houses outstrips supply in central Bangalore. But the good news is that rents elsewhere are moving south
Some areas in Bangalore refuse to believe there's a recession on and as a result, rents have been travelling northward there.
According to a survey by property portal 99acres.com, areas in central Bangalore like Richmond Town have seen an increase in rentals between October and December last year. Rents have gone up by 33 per cent in this area, with a 2-3 BHK flat raking in around Rs 32,000 per month.
But the good news is that rents around Old Airport Road have fallen further. Tippasandra, Kaggadaspura and Malleshpalya saw a decline of over 25 per cent in rentals. Property prices in Yelahanka declined by 9 per cent and R T Nagar offered the most affordable rents around Rs 11,000. Prices also stabilised in Whitefield, Sarjapur Road, Marathalli and Hebbal.
Realtors feel that central Bangalore is showing an opposite trend because of its location. "Central Bangalore is expensive because the demand is higher than the supply. There are very few houses there and of those, fewer are let out," said Balakrishna Hegde, MD, Chartered Housing and former president, Confederation of Real Estate Developers' Association (CREDAI).
Farook Mahmood, president of International Consortium of Real Estate Association, and managing director of Silverline Group, agrees but feels the rate has stabilised now.
"We will have to wait and watch. As of now, the rates seem to have stabilised. After six months, they may fluctuate again," he said.
Real estate agent Suresh Reddy puts it down to the fact that no new apartments have come up in Central Bangalore.
"The apartments that have come up are few and high-end. People prefer staying in the central part of the city. So, the rentals here are more," he said.
Up or down?
We asked a cross-section of people where they thought rents were going. And here's what they said:
ADVERTISEMENT
Agents agree that rents are on a downward trend and may slump further. "There is a lot of availability but no demand. There are many flats vacant around Sarjapur Road. Owners have no choice but to reduce rents. Still, houses are vacant. Maybe this is because there are no recruitments happening and no new people are coming to Bangalore," said Nathan J S, director, V3 Group, a real estate agency in Koramangala.
Saira Harish of Harry and More Consulting agrees. "People are coming to us with a lower budget for houses. They do not want houses beyond Rs 10,000 which was not the case before. Owners too have been reducing rents," she said.
Tenants too feel that the rentals have reduced. "My rental agreement expired last month. I demanded that the rent should not be increased or else I'll shift and the owner agreed without any fuss. This clearly shows that rents have reduced," said Smitha Shenvi, who lives in Malleshpalya, near Old Airport Road.
Ambrita F who lives in RT Nagar says: "I pay just Rs 8,000 for a spacious 3 BHK house with parking. I work in Koramangala and my husband in Whitefield, but we couldn't find this rent anywhere else in the city," she said.
Budget houses are the future
Research by Cushman and Weikfield, a real estate services firm, says the market now is suited for long-term investors and not for those looking at short-term gains. It predicts that by 2009-2010, affordable housing will gain importance, with many developers already focusing on budget houses.
Subscribe today by clicking the link and stay updated with the latest news!" Click here!
