Bengaluru’s housing market in 2025 witnessed a severe affordability crisis as rising property prices pushed 42% of prospective homebuyers in the sub-₹1 crore category out of contention. Despite a 13% year-on-year increase in demand for budget homes, supply continues to lag as developers shift toward premium, high-margin projects due to escalating land and construction costs.
According to NoBroker’s report, resale properties are offering limited relief, but middle-class buyers in the primary market face significant challenges. This widening gap between rising demand and shrinking affordable inventory has forced many first-time buyers toward Bengaluru’s peripheral areas, while others are delaying purchase decisions.
Shift Toward Premium Projects Deepens Bengaluru’s Budget Housing Shortage
Developers are increasingly prioritizing premium and luxury housing to safeguard profitability, resulting in a sharp decline in sub-₹1 crore launches. In 2025, luxury housing accounted for 35% of new supply, with high-end projects contributing another 28%. Affordable housing fell to just 7% of launches, down from 9% in 2024, highlighting a market moving decisively toward higher-priced segments. Homes below ₹1 crore, once considered mid-range, saw their share of new launches drop from 37% to 31%.
Within Bengaluru’s central and established neighbourhoods, supply of budget housing has become extremely limited. Rising land values and construction expenses have led developers to focus on larger 2–3 BHK units with higher ticket sizes, side-lining the affordable segment entirely. Brokers noted that buyers seeking sub-₹1 crore options in the city centre are now restricted to decades-old buildings with limited amenities, and even these are scarce.
Infrastructure Boom Triggers 12% Price Rise, Shrinking Budget Housing Options
Bengaluru’s average property prices rose nearly 12% year-on-year in 2025, reaching ₹7,388 per sq ft. Key micro-markets such as Tumkur Road, Bannerghatta Road, Sarjapura Road, Whitefield, Thanisandra, and Hebbal recorded 9–18% price surges driven by infrastructure growth and strong end-user demand. With prices in prime IT corridors like Whitefield and Hebbal pushing mid-sized units into the ₹2 crore bracket, affordable housing within the city has become unviable.
Consequently, sub-₹1 crore buyers are being pushed to far-flung areas such as Kengeri, Jigani, Doddaballapur Road, and outer Varthur–Sarjapura belts. However, these locations come with trade-offs, including weaker civic infrastructure, distance from job hubs, and projects dominated by smaller developers, raising concerns over quality and long-term value.
Summary:
Bengaluru’s 2025 housing market faces a deepening affordability crisis as soaring prices and premium-focused development shrink sub-₹1 crore supply. With affordable launches falling to 7% and prime areas pushing mid-range homes beyond ₹2 crores, buyers are forced to city outskirts with weaker infrastructure, while many postpone purchases amid limited viable options.
