[JediKnight]

Originally Posted by Rajeevraj

Not sure where it is all headed.

My observation has been that property prices rise in step wave form. Sudden rise to almost un-affordability, then remain there for few years till inflation rationalizes the prices and then repeat. It never comes down since nobody wants to sell at a loss. Bangalore prices were stagnant for a long time. Now this step function has triggered in and the property prices have risen. They will remain stagnant for a few years. This may be the worst time to buy a property. Of course I may be completely wrong.

[speed79]

Originally Posted by ValarMorghulis

Saw a WhatsApp message in the society group today. A 1150sq ft 2BHK is on sale. Asking price is 1.9cr

I'm sure this will fly away as well.

I guess you are talking about Brigade Metropolis. This is really insane. In 2010, I had almost bought one 3BHK 1960 sq Ft at Brigade Metropolis for 80L. 3BHK 1610 sq ft were available for about 65L. Today 1.9 Cr for 1150 sqft 2BHK is unbelievable. The high rents and the ridiculously high preces are even sustainable in the long run?

Is this frenzy only for apartments? I havn't seen such a frenzy in individual plots/houses even in well developed BDA layouts at very good locations, neither in rentals nor in real estate pricing. Or will they be the next?

[am1m]

Originally Posted by speed79

Is this frenzy only for apartments? I havn't seen such a frenzy in individual plots/houses even...

As far as i know, the rates for those are also irrationally high. But yes, I too was surprised that an apartment could command the same kind of rates as a plot or independent house in a city. I guess that's just my old gen thinking. Lots of people would rather have the conveniences and common facilities of an apartment, than deal with the hassles of managing an individual house. Plus given how shady anything to do with property is in Bangalore, buying land is always more of a hassle and prone to getting cheated than buying an apartment.

No guarantees in every case with either of course, but chances of clear papers, genuine sellers, getting to deal in 'white money' vs. cash, etc. are probably better in the case of an apartment deal rather than a land/independent house deal.

[vijaykr]

Originally Posted by speed79

Is this frenzy only for apartments? I havn't seen such a frenzy in individual plots/houses even in well developed BDA layouts at very good locations, neither in rentals nor in real estate pricing. Or will they be the next?

In the last few years, there is a ton of tier-1 developer launched plots/sites on either side of Bellary Road towards Airport and beyond towards Devanahalli.

Just out of curiosity, we had taken a weekend drive and there appeared to be umpteen choices, but most tier-1 projects were pretty expensive back then 65-70+ lacs for smaller 30x40 sizes itself. Other than a demarcated site and a compound enclosing the project, there wasn't anything else. When we enquired with a few developers, they were claiming more than 50%, 2/3rds were already sold etc. Wondered who was buying these then given that there we so many projects as far as the eye could see

Even assuming they provide all the amenities/clubhouse etc. I am not sure how many people actually are going to construct and live there on an ongoing basis. Without homes actually being built, a community will not develop and these will just remain sites for investment waiting for the next buyer to "invest" and hope for their share of profits in the next iteration...

[warrioraks]

Bangalore real estate market is what a frenzy looks like and in my humble view, this is primarily driven by availability of easy credit.

When people see real estate prices jumping 20-30% per year, very few with decent cashflow hesitate to take a loan and buy the dream house (or a second one as well). This leads to a virtuous cycle where more people get pulled in leading to even higher prices.

On top of it, a lot of people are happier to get 3% rental yield on their investments vs 8% on RBI deposits. Presumably in the hope of capital gains on the property. This combined with the desire to pass on assets to the next generation add fuel to fire.

I have been looking for a house over last 3 months. Have seen a couple of good deals go away right in front of my eyes just because I wanted to think about it on the weekend. Eventually came to the realization that the current market is not for a calculative guy like me. The dream house will have to wait.

[lazy]

Originally Posted by ninjatalli

...

Is this the norm now? We are unable to comprehend how a home purchase that in crores is being closed out in a few days; sometimes in less than 24 hours. I get it these are limited cases when the buyer prices it properly, but want to understand from other Bangalore folks if you are observing this too at your end.

I checked with friends in Pune and Bombay who recently purchased similar apartments; they haven't experienced anything of the sorts even for popular complexes. Seems to be a very Bangalore-an situation (and maybe Gurgaon).

If so, who is fueling these short duration sales? Investors? People residing in the same society who have visibility? Or general buyers like us?

And more important, should we consider this as normal for large apartment complexes (similar to all-cash based home sales that became common in the US recently)? Look forward to hearing from fellow owners/buyers.

Ninja

By no means an expert, but here's our experience when we were looking for a property with pretty much the same criteria as yours earlier this year - grade 1 builder, sports amenities, good maintenance, lots of open spaces - except only in Whitefield or thereabouts.

- If one's insistent on ready-to-move property, the demand >> supply esp for largish 3/4 bhks - with WFH more people need a dedicated office room, or with growing kids need for separate rooms, or parents moving in, or need to upgrade generally,
- Since 2021, rents have shot up so much that EMI's aren't looking too bad anymore - upto 2020 rents were really cheap compared to the capex for apartments,
- There are no reasonably priced apartments in such complexes, everything is atrocious - and the current residents have first dibs. Current residents are buying either to use as office, or for older parents moving to Bangalore, or simply investment to rent out. Such older apartments are cheaper than new properties and rentable right away, existing loan is tapering off, hence the buy,
- Agents play a dubious game of showing the same property to 50 people, and keep playing them against each other to maximize value - we could never figure out which property we are viewing is indeed available vs. what's not - almost every "reasonably" priced flat seemed to get sold in a couple of days of we viewing it,

Here is what I suspect is happening - banks typically do a much longer due diligence for loans for resales with lower approval % compared to new buy, buyers also do additional lawyer checks, this typically takes about 30-40 days. So, even after a buy puts a deposit, instead of taking the property off the market, agents keep doing viewing since several loans get rejected. Meanwhile, if/when loan gets approved, only then it is announced as sold.

There were a few agents who showed us properties just to meet us and get friendly, so that they can convince us to invest in total env's some scheme (10% down, rest after 5 years on possession).

Not sure, if this helped at all. It is a bit crazy right now. Keep looking, there are decent sellers too, good luck.

cheers
lazy

[hothatchaway]

Originally Posted by lazy

Ninja


- There are no reasonably priced apartments in such complexes, everything is atrocious - and the current residents have first dibs. Current residents are buying either to use as office, or for older parents moving to Bangalore, or simply investment to rent out. Such older apartments are cheaper than new properties and rentable right away, existing loan is tapering off, hence the buy,
- Agents play a dubious game of showing the same property to 50 people, and keep playing them against each other to maximize value - we could never figure out which property we are viewing is indeed available vs. what's not - almost every "reasonably" priced flat seemed to get sold in a couple of days of we viewing it,

Here is what I suspect is happening - banks typically do a much longer due diligence for loans for resales with lower approval % compared to new buy, buyers also do additional lawyer checks, this typically takes about 30-40 days. So, even after a buy puts a deposit, instead of taking the property off the market, agents keep doing viewing since several loans get rejected. Meanwhile, if/when loan gets approved, only then it is announced as sold.

lazy

All of this is pretty similar to what is happening in the used car market too. You are never sure if the pictures posted by brokers are current or of better days seen by the vehicle. Good deals or rather reasonable ones are gone in a wink. Its difficult to tell how rotten the car is under the hood etc etc.

Just goes to show the basics remain the same when it comes to situations when money changes hands, be it houses or cars.

[androdev]

Originally Posted by warrioraks

I have been looking for a house over last 3 months. Have seen a couple of good deals go away right in front of my eyes just because I wanted to think about it on the weekend. Eventually came to the realization that the current market is not for a calculative guy like me. The dream house will have to wait.

If you are a family man with kids, etc. I would say don't wait for too long. RE prices will never become sensible no matter how long you wait. India is made up of two countries. One large poor country. One small country with rapidly increasing purchasing power. Some people will exit this pool (due to bad job market) but some new people will join this pool - ensuring this pool size doesn't shrink. India is a huge country - it just takes few rich NRIs to return or few rich Tier-2 people to move to a metro to keep the demand high.

If you have crossed the age (married with kids), it's better to own a house irrespective of your expertise in finance/economy, etc. Living in your own house has enormous intangible benefits. Given the crazy prices and affordability issues, one should buy a smaller apartment in a good neighbourhood instead of waiting to buy that dream house. Going for a smaller apartment is a much more sensible compromise instead of playing the waiting game which you are not likely to win. Just consider the possibility that Bangalore would become like Mumbai/Tokyo, etc. where just a place to accommodate a single cot would cost a fortune.

My advice is applicable only to self-occupied house for a family person - they would have maximum intangible benefit.

[ninjatalli]

Thank you guys for the responses. This confirms some of my thoughts; although now I am able to align with what @androdev is stating - this is not going to change. At least not for gated complexes within the city limits.

Originally Posted by vijaykr

Currently I live in a reasonably-sized apartment complex of 300+ flats which is getting to be 15 years old.

Which complex is this? Wondering if it's part of the list I have been scouring over the last few months.

Originally Posted by shankar.balan

One needs to live reasonably close to one’s friends as one gets older. One also needs to be within reasonable driving or walking distance to places of interest and for hobby activities. And of course there is that Sword of Damocles, always hanging over our heads - the nearness to Hospitals is an absolute essential these days.

Echo this thought. We actually started out looking at simple apartments (not ones in gated complexes) that were in the heart of the city, where our friends and family are close by; plus the local amenities and markets that we frequent. Found a few good options, but we were puzzled these apartments/houses were unsold for many months (one that we shortlisted in Q1'23 is still unsold); inspite of the owners reducing the prices. So decided to halt and wait for a while.

I still go through the list that I had curated of such apartments back at the start of the year. None of these were wall-to-wall apartments but rather cases of a large plot broken up into 4-6 apartments over 2-4 floors; with some garden space; but no amenities. Good construction & layouts, in the range of 15-25 years old and close to metro, etc. Surprisingly they still aren't getting picked up by the masses compared to the gated complexes. (e.g. some of these are close to the green line in Jayanagar).

I keep wondering if I should jump the gun and go for it.

[ajcpub]

Originally Posted by shankar.balan

The thing I believe which will work nicely is to find a nice “small builder” who is doing “small scale curated residences” in a BDA type layout and buy in to that kind of project.

Do you mean "builder floor", e.g. an apartment per floor on a 60x40 land parcel. Please be aware that many such projects have fair amount of deviations from the approved plan. Not only will they build an extra floor, they will also build additional rooms on terrace etc.

[sanjayrozario]

Honestly, I'm not surprised with the goings-on that I've been observing. I stay in a tier-1 builder, gated complex society with all modern amenities & more which is adjacent to a metro station. So basically it ticks all your requirements except that it's just outside the ORR. In the society telegram group for sales & rentals, I see some flats put up for sale go in 2-3 days or max a week. Rentals even faster. There was an apartment available in the tower that I live in put up for sale in the morning, so only for curiosity sake, I called up the owner the next day to check on his expectations, he responded it got sold at the price point he was expecting.

[Gansan]

When real estate market is that hot, even people from other cities will try to buy a property in Bangalore if they can afford the price. Last year a cousin of mine sold his 2 bhk apartment in our small apartment complex (16 apartments only) in Chennai and bought a 3 bhk in bangalore fom a top tier builder. He doesn't even live in India and may not even come back here.

[vineetklkrn]

I went through a similar situation and had a similar requirement. Just sharing my experience on how I eventually settled/compromised with this.

I own and stay in an apartment in whitefield but not from tier 1 builder and rather a small builder. Our apartment complex is smaller with <80 Units with very basic amenities. Cost wise we got it for quite cheap in 2012 and now as well the prices are quite normal unlike the Tier 1 societies. It indeed has quite a lot advantages as I get to stay in a prime area (Everything nearby, school, office, shopping) but just that there is not much to do for kid or for us to walk around in the aparment complex itself. And we need to go outside for everything (luckily everything we need is available in 3km radius).

But some time back even we were quite tempted for owning a flat in tier 1 and were quite seriously considering Prestige City for example (3BHK for 83L during launch) and others. But even this cost looked quite high for me (as I was still paying EMI for current house) and we did not go ahead. Now when we look back the prices have more than doubled already and probably we missed an opportunity.
Overall, I feel people (including myself) are looking towards tier 1 builders primarily (apart from investment purpose) for Ameneties and also to be able to live in a larger community as the apartment complexes are really huge with large club houses. This is an enabler for community living, where all possible coaching options are available for kids and the elders get together quite often for community activities especially our festivals. I think this has a very different charm compared to staying in a small community without much amenities in the apartment.

What we did instead is we then bought a plot towards the airport in one such gated community by tier 1 builder. It was relatively cheaper then. The prices are increasing here as well and it is equally competitive. But back of the mind I am still not sure if I will leave my current house in Whitefield and move towards the airport. Also as @Vijaykr mentioned above. Until unless people construct there is no community and hence no benefit. I still hope that the area thrives and we build a house here in near future .

[warrioraks]

Originally Posted by androdev

India is made up of two countries. One large poor country. One small country with rapidly increasing purchasing power.

The house prices in Bangalore make me feel that I am part of former, the poor country.
On a serious note, I feel age is still on my side so willing to wait for a few years to build the dream house. More-over the calculative guy in me is happy to rent out because there are significant advantages to not buying a home - The Capex vs Opex argument.

Few weeks back, I started looking at smaller properties just as you suggested. Not for my use but just as a stepping stone to a bigger and better house when the right time comes.
The idea is, buy a small house - put it on rent. Once EMIs are paid sell, it and buy a slightly bigger one and put it on rent. Rinse and repeat till you reach the dream house and have the cash flow to support EMIs .

[Tutenkhamen]

Been there.
Back in 2019, I was this close to closing on a 2/3bhk in Adarsha Palm, Bellandoor. The quotes were around higher 70s for the 2bhk and 130s for the 3bhk.
Was even planning to fly my parents from North to close on the deal. Well, exactly same week, I casually went to an interview setup and landed an offer with Microsoft. Cool. But it was in Hyderabad. I realised, tech mostly keeps us moving so its not going to be easy to settle on a locality.
Even within Bangalore, my cousin bought a 3bhk last month in another locality within Adarsh island and 2 weeks down, his company dropped the office location which was close to Adarsh. New office location is a good 14kms away.
Prices too have gone unreasonably crazy. The same 3bhk I was closing on? Its now quoted for 2.75+

The fomo is very real but I took a heavy stance and purchased a 7k sqft (4.5k plot and rest is outside lawn. Corner) lot near Chandigarh.
Will construct my mini mansion for family and would probably buy a 1bhk in Bangalore/Gurgaon when some stability is there in job market (hopefully that 1bhk can be had <1Cr lol. Wishful thinking ensues)