Bengaluru emerged as the clear frontrunner of India’s housing boom in Q1 2023, leading sales volumes among the top seven cities as the residential market hit a 15‑year high in quarterly performance. Robust end‑user demand, resilient IT-led employment and improving affordability helped the city consolidate its position as the country’s most stable and absorption‑driven housing market.
Market overview Q1 2023
- India’s top seven cities together clocked around 62,000 primary housing sales in Q1 2023, the highest quarterly tally in over a decade on the back of strong end‑user demand.
- Bengaluru accounted for about 21% of these quarterly sales, edging past Mumbai and Pune and thereby taking the top slot in India’s housing market leaderboard.
- New launches across major cities crossed 75,000 units in the quarter, marking the strongest supply addition in more than ten years and reflecting developers’ confidence in sustained demand.
Why Bengaluru led
- Bengaluru’s inventory overhang fell to nearly 13 months by end‑Q1 2023, the lowest among the top residential markets, signalling very healthy absorption and limited speculative stock.
- A diversified buyer base comprising IT professionals, start‑up founders, GCC employees and salaried households supported stable, end‑use driven purchases rather than short‑term investor activity.
- Developers focused on mid‑segment and upper‑mid projects in established IT corridors, aligning ticket sizes with actual purchasing power and keeping distress‑driven discounting largely at bay.
Pricing and rental trends
- Average residential prices in Bengaluru rose around mid‑single digits year‑on‑year in early 2023, a moderate increase compared with the sharp post‑pandemic spikes seen in later years.
- The rental market was far more aggressive: key IT‑centric micro‑markets such as Thanisandra Main Road and Marathahalli‑ORR recorded rental jumps of about 24% year‑on‑year for standard 2BHK homes in Q1 2023.
- Other prominent hubs like Whitefield and Sarjapur Road saw rents rise by roughly 20–21% over the same period, reflecting rapid return‑to‑office trends and limited ready‑to‑move inventory near employment centres.
Bengaluru vs other top cities
| Dimension | Bengaluru | Mumbai / MMR | Pune / NCR and others |
|---|---|---|---|
| Share of Q1 2023 sales | About 21% of top‑7 city sales. | Mumbai ~20.9% of quarterly sales. | Pune ~19.4%; others share the balance. |
| Inventory overhang | Lowest, ~13 months. | Higher than Bengaluru. | Generally higher than Bengaluru. |
| Rental movement | 20–24% YoY surge in key IT belts. | Double‑digit rental growth pockets. | Mid‑teens growth in select micro‑markets. |
Structural drivers and outlook from Apr 2023 lens
- Large‑scale office leasing and technology hiring kept Bengaluru’s employment engine strong, supporting sustainable home buying despite rising home loan rates.
- Ongoing infrastructure upgrades—Metro expansion, ORR‑Airport connectivity and peripheral road improvements—continued to shift demand toward North and East Bengaluru corridors.
- As of April 2023, research agencies projected that Bengaluru would remain a lead performer through the year, with further firming up of prices and rentals but within a fundamentally end‑user‑driven, resilient market structure.
Bengaluru Leads The Way As Q1 2023 Sees Robust Growth In Indian Housing Market added by admin on
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