BANGALORE: With a new stable government looking to address some problems of the previous one, and with interest rates falling, Bangalore’s real estate market is looking more positive for buyers and investors than it has been in a while. Given that property prices here have been relatively stable in the past few years also makes it quite attractive.
Irfan Razack, chairman and managing director, Prestige Group, says the mood among investors is positive. “What really matters for building Brand Bangalore is good governance and good infrastructure. The ongoing projects should be completed and delivered on time and quality is likely to be maintained,” he says.
Irshad Ahmed, president, Bangalore Realtors Association – India (BRAI), echoes the same sentiment. However, he says infrastructure needs to be improved significantly and the Metro rail work needs to be speeded up.
Builders say Bangalore is also attracting a lot of foreign buyers on account of the weakening of the Indian rupee. A weaker rupee makes Indian goods cheaper in terms of foreign currency. “It makes this the ideal time for foreign investment and Bangalore seems to be the most preferred city (for foreign buyers),” says Rajashekar, proprietor, Elegant Properties.
Home loan interest rates that had gone up to 11% and higher are now down to about 10%. Bankers expect the trend to continue given that the inflation rate is dropping. Interest rates play a big role in real estate because most buyers take large loans to finance their property purchases.
Zahed Mahmood, director in property brokerage firm Silverline Realty, notes that schemes such as where the builder bears the customer’s EMI till the project is complete, is helping to bring buyers into the market.
“Bangalore is more an end-user market rather than speculative. So it’s helping to keep prices stable,” says Mahmood.
There are concerns about the job market though. IT companies are no longer creating as many jobs as they once were. But Irshad Ahmed says this is not an immediate concern.
Realtors are looking forward to the latter half of 2013 when the Real Estate Regulatory Bill and the Land Acquisition, Rehabilitation and Resettlement Bill are expected to be passed. “The Real Estate Regulatory Bill, if passed, will help the growth of India’s realty sector. It will root out all the unethical and fly-by-night operators and enable a healthy business to emerge,” says Zahed Mahmood.