Is Bengaluru’s real estate market overpriced in 2026?

Bengaluru’s housing market is costly but not overvalued. Demand stays strong, yet affordability slips for the middle class as prices rise sharply

Bengaluru’s real estate market in 2026 reflects the city’s transformation into India’s technology hub. The influx of multinational corporations, start-ups, and high-income professionals has fuelled housing demand, particularly in IT corridors such as Whitefield, Electronic City, and Sarjapur Road. As a result, property prices have steadily climbed, raising concerns about affordability for middle-class buyers.

The rise in housing costs has been gradual, driven by genuine demand rather than speculative spikes. Infrastructure improvements—metro expansion, better roads, schools, and malls—have added value to residential hubs. Luxury apartments continue to sell, but ownership is slipping out of reach for average households.

Who Buys Premium Homes?

High-end housing demand is concentrated among financially strong groups:

• Senior IT professionals earning ₹30 lakh–₹1 crore annually.

• Start-up founders and early employees benefiting from ESOP buybacks and exits.

• CXOs and corporate officers seeking upscale amenities.

• NRIs, who account for 15–20% of sales in premium projects, finding Bengaluru cheaper than global cities.

• High-net-worth investors purchasing multiple units for rental income and capital appreciation.

These groups can absorb rising prices, unlike median-income households.

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Why Prices Seem Affordable to Some

For affluent buyers, property still appears attractive. Prices have risen 70–80% since 2020, reinforcing confidence in long-term appreciation. High salaries make EMIs manageable, while NRIs benefit from currency conversion. Infrastructure growth and steady migration further strengthen investment appeal.

Overvalued or Just Unaffordable?

The market may be expensive, but not necessarily overvalued. Overvaluation occurs when prices rise without demand, yet Bengaluru’s projects continue to see strong sales. The real issue lies in affordability—property prices have outpaced income growth for a large share of the population. Middle-income buyers face delays in ownership or must relocate to peripheral areas, while wealthier groups dominate premium purchases.

Conclusion

Bengaluru’s housing market is unlikely to face a sharp correction, supported by employment growth, migration, and investor confidence. However, the widening affordability gap is undeniable. The city’s real estate is not irrationally overpriced, but it is increasingly unaffordable for the middle class—a trend that will shape its future housing landscape.

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