Property price boom in Bangalore to end soon?

Land developers say the market situation will `correct itself'

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The situation of demand far outstripping supply is likely to ease

Most developments will be complete in about a year

FAST DEVELOPMENT: Apartment buildings coming up in the Sarjapur Road area in Bangalore. 

        BANGALORE: The boom in property prices over the past two years, averaging 30 per cent to 35 per cent annually, may end to a large extent in 2006, developers in the city anticipate.

        According to a spokesperson of Sobha Developers, the situation of demand far outstripping supply in the property market is likely to ease in about a year to 18 months when most of the new developments are completed.

        The Brigade Group, a major developer of both residential and office space, feels it will take another 12 months for the market to "correct itself" and for prices to stabilise. They and other builders feel demand will continue to grow with the information technology sector especially on a path of growth. Other market watchers also feel that the hiring of personnel now taking place in the IT industry can only push up the demand for quality housing.

        One interesting feature about the residential apartment complexes now coming up is the large extent of customisation within individual flats. "People want to go by `vaastu' in the positioning of doors and windows and certain indoor fixtures. Since most flats are booked in the pre-construction stage, it is not difficult to meet such requests,'' says an executive of Sobha builders. Choice of flooring, wall tiles and finishes of built-in wardrobes are other options now offered by builders.

        Whether there will be a price correction or not, the entry-level prices for apartments are about Rs. 1,500 to Rs. 1,600 a sq.ft, and in the Sarjapur area it can be as high as Rs. 2,000 to Rs. 2,500 a sq.ft. "You can buy a basic flat for about Rs. 20 lakhs to Rs. 25 lakhs or a premium flat for Rs. 40 lakhs to Rs. 50 lakhs. Penthouses and duplexes command a premium and prices can touch Rs. 1 crore,'' Sobha Developers says.

        Whitefield and Sarjapur are now preferred locations, and the North and North-east are where the building boom is on, most developers say. Another location to watch out for is Kanakapura Road. "Proximity to the IT corridor and the Outer Ring Road are deciding factors for location, and the Peripheral Ring Road, when it is built, will see many new developments along it. Accessibility matters to investors,'' says an executive of the Brigade Group. Bellary Road is another area which is seeing a lot of activity.

        Value addition, what developers call "add ons", are no longer just a clubhouse or a swimming pool.

        "These have become the norm; what apartment buyers now expect is more open space with scope for outdoor sports or just walking and jogging. This means we have to keep more space `unbuilt' and build vertically. Twenty-storey buildings will become more common soon,'' they explain. Potential homebuyers go both by location and the reputation of a builder, and are most serious about avoiding legal hassles over title later.