Is the cost of rent finally going down in Bengaluru's IT corridors like Koramangala and Whitefield?

Recent observations have suggested a potential shift in Bengaluru's rental market dynamics, particularly in its prized IT corridors. After years of relentless escalation, fueled by the city's tech boom, there are indications that rental prices might be stabilising in different areas like Koramangala and Whitefield.

According to a recent report by Moneycontrol, some rentals in IT suburbs such as Whitefield have reportedly decreased by 15-20% year-on-year. This contrasts sharply with previous years' increases, signalling a potential cooling-off period in these sought-after locations.

The report explains that the increasingly popular hybrid work culture and soaring rents in prime IT corridors is pushing techies outside such areas, such as to the metro-connected Old Madras Road and KR Puram.
"Today, we see a major cooldown in rental prices in the outskirts of IT corridors like Whitefield," observed Sunil Singh, Vice President of Realty Corp to the organisation. "A 2 BHK rental in suburbs like Kadugodi, Hoodi, and Channasandra has come down to Rs 30,000-35,000 from Rs 40,000 a year ago."

However, it is crucial to note that other sources, such as ANAROCK research, indicate different trends in rental pricing across Bengaluru's prime IT hubs. The organisation’s data provides a more nuanced view, revealing that rental prices continue to suffer from slight increases in some of these areas.

As per ANAROCK’s Q2 2024 estimates, the average rent of a standard 1,000 square feet 2BHK currently stands at Rs 35,000 in Sarjapur (Rs 1,000 more than in Q1), Rs 33,700 in Whitefield (Rs 1,200 more than Q1), Rs 22,000 in Electronic City (Rs 700 more than Q1) and Rs 48,500 in Koramangala (Rs 1,900 more than Q1).
It may be notable that the jump is slower than what it was from the end of 2023 to Q1 2024, which saw rents rise by Rs 2,000-3,000 in some prime IT corridors. This indicates that the price of rent is indeed stabilising. And as techies move away from these tech hubs, landlords have begun to give in to desperation.

For instance, the Moneycontrol report notes that some Koramangala landlords have reportedly reduced rents by Rs 10,000-15,000 to attract tenants in response to changing market dynamics.

As Bengaluru's real estate market responds to new housing developments and evolving work-from-home trends, the outlook for rental prices in the city's IT corridors remains dynamic. Whether the current trends signify a lasting shift or a temporary adjustment underscores the complexity of Bengaluru's real estate landscape.