Bengaluru's Housing Market Soars with 5.3% Annual Growth, but Affordability Concerns Rise
Bengaluru, which has ranked 1st in the Ease of Living Index by the Ministry of Housing and Urban Affairs (MoHUA) for cities with a population over a million, has recorded a 5.33% compound annual growth rate (CAGR) in house prices over the past five years, according to a report by Liases Foras, an independent non-broking real estate research company.
Additionally, the report shows that house prices in Bengaluru appreciated by 7.2% in 2025, driven by strong job creation, real estate demand, and infrastructure expansion. This upward trend reflects strong investor confidence and market resilience. In 2024, prices had appreciated by 7.6% in Bengaluru, as per the report.
However, an alarming trend has emerged in Bengaluru where builders are focusing more on premium 3BHK residential apartments in the Rs 1 to 2 crore price bracket and fewer 1 BHK units priced under Rs 30 lakh and between Rs 30 and 50 lakh. This indicates a shortage of new supply in the affordable housing segment in Bengaluru.
The report indicates that new 335 1 BHK units were supplied by builders in the under Rs 30 lakh category, while 1,725 new 1 BHK units were supplied in the Rs 30 lakh to Rs 50 lakh category. There was no new supply in the 2BHK Rs 30 to Rs 50 lakh category, while 3,679 2 BHK units were supplied in the Rs 50 lakh to Rs 1 crore category.
The report also noted that 3BHK units lead the new supply chain, driven largely by strong additions in the Rs 1–2 crore brackets. The Rs 1 to Rs 2 crore category saw 22,174 new 3BHK units being supplied by builders, while 6,655 new 3 BHK units were supplied in the Rs 2 to Rs 5 crore segment.
The report further stated that plots and villas recorded the second-highest overall supply, reflecting significant traction for independent housing, especially in the mid-top premium ranges. 2BHK units continue to have a solid presence in the mid-income brackets, but 1BHK and 4BHK units have comparatively lower contributions to the total housing supply, while other categories have the smallest share of overall supply.
Vishal Bhargava, Founder of BHK Voice, says that 'affordable homes' in most Indian cities are a significant compromise for home buyers. Buyers want comfortable homes at respectable prices, and builders want good and steady margins. Bhargava explains, “This equation works as long as prices don't go out of touch with the average home buyer.”
Bhargava predicts that there will be a weakness in 'luxury homes' but a resurgence in 'mid-priced homes' in the coming years, and thus the average home buyer should not be discouraged. His time will come. He has to be patient, evaluate the numerous options, and buy carefully. Price growth has already plateaued.
The report indicates that sales are highest in the Rs 1 crore–Rs 1.5 crore segment with 17,606 units, followed by the Rs 2 crore–Rs 5 crore segment with 13,614 units and the Rs 1.5 crore–Rs 2 crore segment with 13,093 units. This suggests a significant demand concentrated in the premium and upper mid-income housing categories.
According to the report, unsold inventory is also the highest in the Rs 1 crore–Rs 1.5 crore segment with 21,028 units, followed by the Rs 2 crore–Rs 5 crore segment with 15,890 units and the Rs 1.5 crore–Rs 2 crore segment with 15,359 units. This reflects substantial supply build-up, particularly across the high-value residential segments.
Source: Liases Foras report
Table showing annual unit sales of homes in Bengaluru (2025): | Annual Unit Sales of Home (2025) | Quantity | |----------------------------------|----------| | Less than Rs 10 lakh | 141 | | Rs 10 to Rs 30 lakh | 1612 | | Rs 30 to Rs 40 lakh | 1142 | | Rs 40 to Rs 50 lakh | 3133 | | Rs 50 to 75 lakh | 7702 | | Rs 75 lakh to Rs 1 crore | 9658 | | Rs 1 crore to Rs 1.5 crore | 17,606 | | Rs 1.5 crore to Rs 2 crore | 13,093 | | Rs 2 crore to Rs 5 crore | 13,614 | | Rs 5 crore to Rs 10 crore | 837 | | More than Rs 10 crore | 8 |
Source: Liases Foras report
Table showing unsold house supply stock in Bengaluru: | Unsold Supply | Quantity | |------------------------------------|----------| | Less than Rs 10 lakh | 211 | | Rs 10 to Rs 30 lakh | 3667 | | Rs 30 to Rs 40 lakh | 2059 | | Rs 40 to Rs 50 lakh | 4138 | | Rs 50 to 75 lakh | 9487 | | Rs 75 lakh to Rs 1 crore | 11078 | | Rs 1 crore to Rs 1.5 crore | 21028 | | Rs 1.5 crore to Rs 2 crore | 15359 | | Rs 2 crore to Rs 5 crore | 15890 | | Rs 5 crore to Rs 10 crore | 1243 | | More than Rs 10 crore | 10 |
Source: Liases Foras report
