Rental market in Bangalore sees an upward swing
The rental value for high-end residential properties is mind-boggling. In happening city areas, where a company leases a residential property, it is anywhere between Rs. 1 lakh to Rs. 3 lakh a month depending on the location and amenities.
Of course, the mid and lower segments that swing between Rs. 10,000 and Rs. 35,000 a month have more inventories where demand and supply match is easier. Compared to last year, rental market is seeing a 10 to 12 per cent increase in both residential and commercial segment this year. “This is obvious in Whitefield, Outer Ring Road and the CBD where millions of sq. ft in commercial office space has been gobbled up for rent at Rs. 30 to 45 a sq. ft per month. Even as of last year there were high vacancy levels,” says Mr. Mahmood real-estate consultants.
Bangalore’s super-luxurious housing sector accounts for about 20 per cent of the occupancy market. Says Vinaya Chandran, VP, Strategic Markets, CoreLogic Global Services, “There are multiple markets within rentals, the highest end are units within gated communities or luxury apartments where very senior managers/expatriates stay on rent on short-period Bangalore postings.”
Then there are the “aspirational shifters” who may be willing to pony up to 25 to 35 per cent premium over existing rentals to get into units with some “commonly aspired for amenities”. Mr. Chandran speaks about occupation worthiness (water, access road and stable power supply) and crowded points like malls and railway lines that could prove negative because of clutter and noise.
“From the accessibility point of view, rentals/ownership may be sold with this USP. But for units right next to a railway line, the level of noise and vibration along various stretches can be understood only after full commercial operations resume. If the BMTC feeder routes click in terms of quality and price, then ‘near-metro’ advantage can bring in a ‘rental boom’ too,” he says.
Residential projects have been absorbed for rent. But rents in Bangalore are still behind Mumbai and Delhi.
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