With the entry of lower segment (below Rs 20 lakh) properties, drastic
changes are expected in the Bangalore's residential realty market. Speaking
at a press conference, President Mr.Balakrishna Hegde said, "A
few Bangalore developers have already begun to work on an entry strategy
for the lower segment and by mid 2008 there entry is expected.
He also said that around three to four Bangalore-based developers
have already approached various state government agencies and may launch
projects in 2008. "The city is experiencing huge demand about 50,000
units, including flats and houses per year and the property market is
no longer dependent on software and BPO employees alone. People working
in other sectors like biotech, NRIs, high networth individuals (HNIs)
and research institutes and companies have come are showing interest
towards property investment in a large number" said Mr. Hegde.
"Based on the demand and bookings made, there are 1.5 lakh units
under construction to be ready for occupation in the next three years,"
he added. 12-15 per cent price hike is expected in 2008 due to an immense
upsurge in demand. The rise in 2007 was lower at 7 to 8 per cent due
to interest rate volatility and abundant supply from several projects
hitting the market. Property market in Bangalore has stabilised in the
last six months and also matured with the composition twisting towards
actual users rather than investors as seen in the earlier years.
Recently, the city has been attracting huge foreign direct investment
(FDI). So far the city has attracted 25 to 30 per cent of total $100
billion FDI which came to India in 2007." Speaking on the NRI market
and foreign investment, Suresh Hari, secretary, KOAPA said, "There
has been an increased interest shown by NRIs, especially from West Asia,
the US and Singapore.
Also a few foreign groups are trying to make their presence felt in
the city. There is a considerable amount of foreign funds waiting to
be pumped into the sector which will ensure a better quality of real
estate bringing newer technology and it will speed up construction.
