The virtual explosion of the housing market in the greater Bangalore metropolitan
area in the last decade just goes to show you that bubbles in real estate aren't confined
to the United States and the other industrialized western countries. The price of
houses and apartment rates in Bangalore in particular have experienced a meteoric
rise in recent years for a variety of reason.
For one thing, the economy of the city is doing incredibly well due to the homegrown
IT industry in India, as well as foreign companies setting up shop in town. It's not a
big surprise, considering the environment. Cheap operating costs, a highly educated
populace feeding the workforce, as well as a favorable business environment make it
an attractive locale for science and industry.
Multinational corporations like Siemens, SAP, Oracle, Wipro, Infosys, Google, Dell,
and Amazon, as well as many major Internet Service Providers all have campuses in
Bangalore, making it the epicenter of the high tech sector in India. This boom in
wages and earning power of the local residents has inevitably led to an increase in the
cost of living. With so many up and coming workers vying to join India's growing
middle class consumer population, this puts upward pressure on real estate prices and
drives the market to be more expensive. It's not surprising then, that this situation
opened up the window for developers to take advantage of the situation.
Driven by the increase in prosperity due to the IT sector as well as major industrial
manufacturing operations, Bangalore became known as the Silicon Vally of India, and
rightly so. All that cash flying around led to land going up in value at an astonishing
pace. A relatively small home plot ended up going for up to 5 million rupees and
above. This major increase and land prices made apartment housing far more
attractive and popular.
Apartments and flats in Bangalore are attractive for a variety of reasons, price
notwithstanding. Gated apartment complexes provide safety and security, are
relatively clean and comfortable, and provide generally reliable electricity and water
services. In addition, many provide additional perks like tennis courts, fitness clubs,
playgrounds, and other recreational amenities that one wouldn't have access to at
decent price in a private home.
Many builders have moved in to fill the demand for upscale living quarters. This has
led to a diverse array of construction outfits courting potential tenants and buyers with
high quality real estate, with all manner of benefits and perks. Contractors like Adarsh
Developers, Kristal Group, and Sobha Developers are putting up units as quickly as
possible, but with demand exceeding supply, real estate prices continue to rise far
above the percentages that are typical in more developed nations. This positions India,
and real estate in particular, as an extremely good bet for overseas investors, however
the market pans out elsewhere.