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The first quarter of this year may have been rather uneventful pertaining to the price of Property in Bangalore, the cities real estate prices at a few localities did inch forward, but just an inch, posting no gains to write home about but nothing to indicate anything ominous either. \n
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The first quarter of this year may have been rather uneventful pertaining to the price of Property in Bangalore, the cities real estate prices at a few localities did inch forward, but just an inch, posting no gains to write home about but nothing to indicate anything ominous either.
The trend described above may indicate that the markets as yet are tentative regarding the future direction of real estate property in Bangalore, unsure whether this is a buyers’ market or a sellers’ market, prices may simply have risen slightly just as prices of real estate are expected to gradually rise over time. Some parts of the city posted gains in prices that were higher than in other parts of the city, yet real estate prices in a few regions of the city did fall moderately. Ostensibly, there is no likely trend and the market may simply be ambling along largely unconcerned with the activity of buyers and sellers.
However, what may the market be covertly trying to show us? In many ways, to those who listen, the market reveals what is really going on. One signal the market is telling us may be gleaned from the price of readymade property versus property in Bangalore that is still under construction. It would seem that the price of readymade 2 & 3 BHK flats in Bangalore has dropped in price compared to the price of similarly sized flats which are still under construction. Whereas the difference between the prices of the completed homes and those still in the process of being completed was 6 percent in the final quarter of last year, in the first quarter of this year the difference was only 5 percent.
As largely, the price of ready to move in 3 and 2 BHK flats in Bangalore has appreciated, one can safely assume that since the price difference between the prices of ready to move in flats and that of those under construction has narrowed, the price of flats in Bangalore that are under construction too has gone up.
Hence, we may guess that the price of property in Bangalore that is still under construction too has largely appreciated. This is good news for builders in Bangalore; they can now off load their inventory which is still under construction at a higher profit when they decide to sell at some future date. It’s also good news for those who bought these upcoming projects in Bangalore as mostly likely; many such buyers have already seen the value of their investment rise in value.
Of the many such projects in Bangalore that are still in the process of being completed, not all units may have as yet been sold, those which are still with the builder today provide a much valued and appreciating asset to the builder. Those flats in Bangalore which are under construction and in the hands of private investors can be sold by the same in the secondary market at a modest gain. Yet the direction of real estate in Bangalore, the future trend extrapolated from current trends, may actually point towards greater demand for Luxury apartment in Bangalore in the third quarter.
In the third quarter we may find the price difference between ready to move in property and property under construction to narrow further and the price of both to appreciate, as it has likely done in the first quarter of 2016. Though the gains may be modest, property rates in Bangalore in the future are likely to point upwards.