[ninjatalli]

We have been on the lookout for an 3 bedroom apartment with a very specific set of requirements - primarily close to metro connectivity (current & planned) & within the city & not beyond the outer ring road (and a few other considerations / requirements) over this year. However we have been observing a very weird / interesting trend

Target: Apartments in established/popular builder gated complexes that have not been priced obscenely high (which seems to be the default)

• Experience 1: (Mar'23) Ad appeared on one of the marketplaces (e.g. 99acres, nobroker, etc.). On calling up, a screening/viewing of the apartment is suggested the coming weekend (~2 days later). We visit the apartment on Saturday morning. When we call back on Sunday, the apartment is already sold. This was for an apartment complex that was 15+ years old.
• Experience 2: (Apr'23) We see an ad for a different established complex (>20 years). We call up the owner and fix a time but closer to the day, he shifts it to the next day. We agree and drive down the next day to see the apartment but on the way, we get a call from him saying the apartment has been sold. He shares the agreed price was similar to what he asked for.
• Experience 3: (Apr'23) We see an ad in a good apartment complex (~10 years old) and head over to have a viewing. Apparently the details was shared with multiple brokers and there are atleast 4-5 parties viewing the house at that allocated time. Not surprised when we call up next day morning, but the apartment is sold already.
• Experience 4: (Dec'23) We had put off the house hunt due to personal reasons but see another apartment in the same complex. This time we call and make sure to reach at the first appointment possible. That was on Sunday evening. Monday evening (<24 hours) I call the owner and he informs me he sold the apartment at a price slightly higher than what he quoted (indicating a bidding war? Or not revealing the truth to me?).

All above were not going cheap but just that they hadn't been priced sky-high as a lot of the apartments seem to be on marketplaces (those remain unsold for months). There were more experiences; some whom we couldn't even get to see a viewing. The above mentioned complexes are from good established builders - Sobha, Prestige, L&T and the sorts; with multiple amenities and a well established society.

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.


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@Mods, created a separate thread as the query was specific to real estate conversations in & around Bangalore.

[Red Liner]

There is a serious shortage of exactly the type of apartment you have listed as "you want".

1. A great brand name gated community. Tier 1.

2. Has to be within the ballpark of a metro line.

3. Has to be priced in the luxury category and not super luxury elitist (think 5 bedrooms etc).

4. Has to be in the vicinity of a CBD area and not some far flung off place.

Now if you add all this together, where is the new land for any of this? The land parcels are extremely small these days, and no new land can ever be created. Secondly, the number of people who have decided to exit NCR and move full time to Bangalore with their jobs has absolutely sky rocketed. None of them want to rent beyond the honeymoon period of settling down here and none of them even want to go back! For obvious reasons if i may add.

Your only other option is to scout around for a brand new development where the chances of getting an apartment of your choice will be far far higher. Enlist No broker to help you out on both sides of the game, old existing units as well as new developments with your target criteria in mind.

There are no two ways of saying this but once the airport line is fully functional, expect all property prices along the metro line to experience another jump. Add the fact that there is still no last mile connectivity from any metro station, nor is there adequate parking, the fact that your apartment is within a walk to a metro station is going to be the number 1 criteria very soon if not already!

[vijaykr]

Currently I live in a reasonably-sized apartment complex of 300+ flats which is getting to be 15 years old. This is walking distance to metro with other good connectivity options and close to lifestyle amenities. The complex itself has pretty good facilities for a building that is well within the city now. I am certain if the same builder had a 2nd chance at this building, we would have got much higher towers and next to no usable space around

There is good amount of new/under construction apartment supply around our building with some at really fancy prices. A couple of years ago, I had heard of some owners in our complex asking for what I thought were very high rates for their 10+ old flats. But since then there have been multiple flats sold off for what seems to be reasonable rates - pretty much similar to what was in the market several years ago. And in almost all of these cases, the sale was concluded in days - in some cases over a weekend itself. By the time I reached out to enquire and requested a day or two to think, the sale was over

While in most cases, it was to other existing residents or their friends/relatives, I was surprised at the speed with these which 1.5+ cr deals were closed out. There were some outside sales too, but not at a significantly higher amount.

I guess the demand is higher for older apartments with well-established community and facilities as it becomes easier for new buyers to move in and not have to deal with builder for issues. The specific flat bought may need to be updated/upgraded etc. though. And from living in our own complex from its early years, I can say that it does take time to get all amenities and facilities functioning without having to intervene frequently. The age of such apartment complexes being over 10 years probably acts as a dampener on the price going out of reach. And the seller having lived or used the flat for a while also gets a reasonable price I suppose.

[ValarMorghulis]

We live in a tier-1 builder society complex with Metro right at the main gate.

1. Flats in our society are going at an eye watering rate. For eg. 600sqft 1BHK retails for >1cr (if you can find one on sale). I don't even know if anyone is selling. (Rental for 3BHK last month was 1.25lakhs)
2. I do see 2BHK on sale in MyGate occasionally, but these ads are for short duration (esp. if the asking price is not ludicrous)
3. 3BHKs are not on sale (unless you literally throw money at folks)

I've been on the lookout for an additional 1 or 2BHK with your criteria. Forget existing ones, even new flats are sold out before they actually launch! Prestige Park Grove (Whitefield-delivery 2028) had zero flats from builder on day-1 of launch. Only 4BHKs were left.

Tier-1 builders are keen to sell you 3BHKs (to be delivered in 2028 or later) at ridiculous prices with no approach roads, no development in the area or Metro in the locality.
It is a seller's market out and out.

I'd suggest doing regular pranayama to calm your nerves and be on the constant lookout.
PS: Do not go for tier-2 builders with under construction flats.

[shankar.balan]

@ninjatalli
@redliner

Absolutely right. It’s funny how the demand seems to have suddenly started outstripping supply. And no one bats an eyelid at these prices these days, which run into crores and crores, which to me, are still eye watering prices.

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.

The gigantic rabbit warrens and ant-hills of apartment complexes, are frankly, truly frightening to even look at. I start hyper ventilating even if I go past one of those. (My own psychological problem)

Hence I am also taking the course that I outlined above, as a sort of ‘advance planning for retirement” kind of exercise. Moving away from an investment made earlier nearer the outskirts and moving closer to friends kind of thing.

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.

[ashis89]

More than a year ago, I heard a guy boasting that he was able to book a 3BHK at Prestige City which has 10s of thousands of units and each costing crores. Others around him lamented their bad luck of how they were late to reach the site. One of them consoled himself that atleast he could get that villa plot for crores. That day I knew there was no sense in real estate market. There are people out there who have the money and the need/risk appetite to invest in real estate.

The Covid salary boom has helped everyone to buy their first house. Or upgrade to a bigger one. Or invest in a 2nd/3rd/4th/5th property as it can fetch good returns. So much so that almost anyone I talk to has bought a property in the past year or so.

Most of the overnight/quick sales happen within residents(and their acquaintance) of the same society. With the sky-rocketed rents, anyone with some money and good credit score is looking to buy their own to avoid rents or buy another to put it on rent.


Finding sense in these numbers is tough. Like it has been said, please continue to do some yoga and keep looking. If you have friends living in some of these societies, put in a word so you will know if something comes up for sale. If the purchase is a priority right now, maybe talk to some brokers.

[am1m]

Originally Posted by shankar.balan

And no one bats an eyelid at these prices these days, which run into crores and crores, which to me, are still eye watering prices.

Originally Posted by ashis89

There are people out there who have the money and the need/risk appetite to invest in real estate.

I too belong to the generation that thinks multi-crore(s) is too much to spend on a small apartment without any sort of real facilities (tanker water supply, no good access roads, etc) and dubious construction quality. But the reality is there are enough people comfortable with that kind of pricing and assured enough to take loans that they will be working for the next 2 decades to pay off. That's the buyer profile that anyone looking for an apartment in Bangalore will be competing with. Then there is always the black money that gets spread around as real estate 'investments'.

[androdev]

In good residential projects, there is a strong demand from current residents (as an upgrade, as an additional purchase or for their close relatives+friends). These buyers would be ready to pounce as soon as a reasonably priced unit comes up for sale. Outside buyers typically need to spend a lot of time in due diligence, scheduling a visit, comparing different options, assessing the price, etc while these inside buyers are just waiting to make the payment as soon as they come to know of a sensibly priced unit. If the project has a very good society feel to it, it's really hard get a resale unit due to unfavourable demand-vs-supply situation.

[dass]

I think this is limited to the 'select criteria' within certain zones in Bangalore. I have a 2 BHK, shares its boundary wall with the Bagmane Constellation tech park, walking distance to the upcoming metro station, excellent rental value out for sale and not much movement. This is a stand alone apartment, 20 flats only.

If someone is serious to invest in Bangalore Real Estate, plan for the future and look at areas where either a Metro is planned in the future or a slew of Infra developments are currently happening. Though there is no guarantee of appreciation as that truly depends on the government of the day, the chances are higher. However, if the intention is for self use, be ready with cash so that a decision can be made faster. One way is to research about the locations/properties that you would want to buy and keep looking for those to open up.

[mpksuhas]

Originally Posted by ashis89

More than a year ago, I heard a guy boasting that he was able to book a 3BHK at Prestige City which has 10s of thousands of units and each costing crores..

There is no sense in real estate market as you said. However, that is always been the case if you think about it. Just that the price range differs.

Specifically about Prestige city on Sarjapur road, they have tapped on the demand post Covid from people having an existing smaller 2 or 3BHK and needing to upgrade to a bigger 3BHK with more facilities.

Hence apart from the initial block, all the apartments are having only 3BHKs and the rate at which it was getting sold out was surprising.

Many have booked for investment purpose, not sure how that will work out since the initial investment itself is high.

However, for anyone looking for a house in this part of Bangalore, the ballpark figure for under construction 3BHK from a reputed builder starts from 1.5 crore.

[Rajeevraj]

I think this is going to be normal and expected in large complexes from the Tier 1 builders. Even I am confused as to where the demand is coming from, but most new launches are getting sold out in a few days. Resale in these large complexes also seem to get closed very quickly. Of course, if it is next to a metro station then everything goes up multifold.

Although this is not the case for Tier-2, Tier-3 builders which make up a large part of Bangalore. Here I think sales are still not easy.

The infra development is too slow to keep up with the rapid expansion and requirements. Even the fundamental requirements are just not able to keep up. For all the complaints about Bangalore, people just seem to be endlessly flowing into the city because of all the opportunities the city offers.

Not sure where it is all headed.

[Mik]

Prices have jumped a lot in the recent past in Bangalore. I would say close to 50% in last 2 years. My previous apartment complex (Prestige property) has had an appreciation of close to 70% in last 3 years.

The factors i see for the following

1. More and more people are being called back by companies. The landlords, deprived of any appreciation of rent in covid years, are looking to make a buck considering the elevated salaries.
2. The covid WFH effect - folks returning to bangalore after 2/3 years are suddenly faced with crazy appreciations in rent. These are folks who have also saved a fair bit in the last few years due to cheaper cost of living in native places. These guys are willing to put down the dough for down payments on bigger flats.
3. 21/22 saw crazy hikes for many IT folks. My firm operating cost went up by close to 30% and it was not unheard of seeing folks doubling their salaries over 2/3 offers.
4. Bangalore real estate has been fairly steady for many years. Prices were not going crazy and compared to cities like Mumbai, things were pretty cheap. RE tends to be cyclical in nature and i think we are well on the way to a bull run. Where does this madness end? I guess the reference point is today Mumbai and not Hyderabad/Chennai.
5. Hybrid work scenarios has meant that the apartments which were traditionally not 'prime locations' are also now being considered by folks for rent and buying - thus appreciating as well.

Now we are seeing a Black Friday-esque apartment launches. Builders are also stifling supply and declaring 'sold out' pretty quickly. The FOMO has reached such proportions that most of the inventory on offer is being lapped up by frenzied investors with EOI (Expression of Interest) cheques for 'Prestigious' properties.

[GutsyGibbon]

Originally Posted by ashis89

Most of the overnight/quick sales happen within residents(and their acquaintance) of the same society. With the sky-rocketed rents, anyone with some money and good credit score is looking to buy their own to avoid rents or buy another to put it on rent.

This past year, I have been involved in funding the purchase of 2 apartments for family members. Both deals were through acquaintances or people known very well to residents. The person who sold the apartment to us, did so because I was related to their friend & neighbor. He told me that he would sell the apartment to someone he knows (at a lower price), than try to get a slightly better price and take on the risk of dealing with unknown parties. Especially the black and white stuff.

I think (not an expert in the field) this lack of trust is because of a lack of an escrow system, and title insurance. I need to wire the entire amount to the seller, and hope he will show up the next day at the sub registrar's office for registration. As a buyer, you hope the seller is legit, with legit khata, legit papers (no dues, liens, etc). I had a very good lawyer draft everything, review everything. Even then, I needed to act based on trust, & things took a lot of time. If you need the transaction to be done at a certain time, you certainly want to deal with legit people, and not brokers who want to hook you in with a deposit and shop around for better prices. I think people are tired of such players, and are apprehensive about who they deal with.

In the US, an escrow company holds the buyers money, and the sellers documents. It verifies the contingencies, inspections, verifications, liens, and ensures there is a clean transfer. The title deed is verified and underwritten by Title insurance company, and the seller and buyer never see each other. In the Indian context, I knew the seller on first name basis, and have exchanged hundreds of WhatsApp messages with him & his family. Imagine doing this with someone you cant get along with. All of this is funded by hefty closing fees paid by both buyer and seller (downside), but the transaction itself can be trusted. When you are sinking good part of life savings, trust and peace of mind matters. The way people deal with it is by only dealing with people in their good known circles.

Sorry, if I am generalizing the market/system based on my small sample set.

[sagarpadaki]

GutsyGibbon, you are right on the trust factor in these high value transactions. A colleague of mine was duped a couple of years ago. He made a advance payment in cash of a few lakh rupees to a landowner whose plot he intended to buy. The owner went incommunicado after taking the money. He was not able to contact. He lodged a police complaint. But since the landowner was in Andhra/Telangana and since it was a cash transaction, the police did not do anything.

[ValarMorghulis]

Originally Posted by ValarMorghulis

We live in a tier-1 builder society complex with Metro right at the main gate.
...
It is a seller's market out and out.
....

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.