IT hubs on fire: Bengaluru and Hyderabad lead India’s real estate boom with home prices soaring up to 90%

Real estate markets in Bengaluru and Hyderabad—both located in the southern peninsula—are booming.

Home prices have been on the rise for quite some time, but the country’s two major information technology hubs are now experiencing an unprecedented surge. Real estate markets in Bengaluru and Hyderabad—both located in the southern peninsula—are booming. The growing demand for Indian IT services and professionals, especially after the COVID-19 pandemic, has significantly increased the demand for new homes in these two metros, pushing prices up substantially.

Data shows that, over the last five years, home prices in key locations of Bengaluru and Hyderabad have surged by as much as 90%. For instance, Bagaluru—a suburb in the northern tip of Bengaluru near the international airport—has seen home prices rise by 90% between 2019 and mid-2024. According to experts, improved connectivity in the region, with the airport metro line nearing completion, has contributed to the surge in demand for the locality. Additionally, many new homebuyers now seek larger homes with ample greenery away from the city center, further driving demand. Bagaluru has recorded the steepest hike in average home prices.

“With new supply of approximately 17,065 units during this period, average residential prices in Bagaluru jumped from Rs 4,300 per sq. ft. in 2019 to approximately Rs 8,151 per sq. ft. in H1 2024,” says Anuj Puri, Chairman of Anarock Group. “A deeper analysis reveals that of the total new supply launched in this micro-market since 2019, over 94% was in the price bracket of Rs 40 lakh to Rs 1.5 crore—the mid and premium segments. The remaining 6% was in the luxury segment priced above Rs 1.5 crore. Notably, there was no new affordable supply in this locality.”

In Hyderabad’s Kokapet, the situation is similar. The commercial and residential hub in the west of Hyderabad, which includes a special economic zone, is currently one of the most sought-after locations in the state. Average home prices have jumped 89% since 2019, according to data from Anarock Research. The area saw close to 12,920 units of new supply during this period, with prices rising from Rs 4,750 per sq. ft. in 2019 to Rs 9,000 per sq. ft. in H1 2024. A significant 52% of the new launches were in the ultra-luxury category priced above Rs 2.5 crore, followed by a cumulative 30% in the mid and premium segments. The remaining 19% of supply was in the luxury price bracket of Rs 1.5 to 2.5 crore.

Whitefield in Bengaluru follows closely, having recorded an 80% rise in home prices over the last five years.

While most regions reporting steep rises in home prices are located in Bengaluru and Hyderabad, the Delhi-NCR market has also made its presence felt with two locations in Haryana. The Dwarka Expressway region—currently a hotbed of real estate activity—ranks fourth, with prices rising by 79%, while New Gurugram has seen a 48% increase.

Panvel near Mumbai has also been witnessing significant activity lately. Home prices in the region have surged by 50% over the past five years as metro lines extend to Navi Mumbai, opening up new micro-markets for real estate developers.

“Housing price growth accelerated after the pandemic, particularly over the last two years,” says Puri. “According to our data, the top seven cities collectively saw over 44% price appreciation in the last five years. At a city level, Hyderabad recorded the highest jump of 64% between 2019 and H1 2024, followed by Bengaluru with a 57% increase. The lowest price growth of 25% was seen in Kolkata. NCR and MMR both witnessed a 48% price appreciation during this period.”