Bengaluru rental market: Increased housing supply leads to a 5% rent correction but rentals in the IT corridor up due to demand from techies, say brokers

Bengaluru's rental market has rebounded significantly four years after the pandemic. Initially, a mismatch between supply and demand drove rents up, with landlords making unusual demands, such as requesting LinkedIn profiles and salary slips. However, the market is stabilizing, with more rental units available and a 5% price correction. Meanwhile, rentals in the outskirts, such as Whitefield's eastern IT corridor and North Bengaluru, have increased.

Local brokers say that increased supply and more rental options has led to a 5% price correction.

"In areas like Koramangala and even Indiranagar, owners are willing to negotiate for ₹5000-10,000. There is a considerable inventory available today," Manjesh Rao, Chief Real Estate Officer at BrokerInBlue said.

In 2023, high-demand areas like Koramangala, Sarjapur Road, Whitefield, and Bellandur saw annual rent hikes of up to 35% as landlords sought to recover pandemic losses amid a surge in demand driven by employees returning to offices.

However, real estate brokers now anticipate a more stable rental market. "During the two years of the pandemic, the real estate sector took a significant hit. When the city reopened and offices resumed, a demand-supply mismatch caused rents to soar. But moving forward, we don’t expect a major surge in rentals," said Rao.

Rao added that compared to the 2022-2023 period, when tenants scrambled for available housing inventory, today, there are a comfortable number of apartment rentals available in the city. This also gives prospective tenants more choices area-wise.

Real estate experts also note that rents in the outskirts of Whitefield's eastern IT corridor and North Bengaluru have surged, driven by high demand from tech professionals seeking these areas.

Rents correct in Bengaluru's prime areas

Kiran Kumar, vice president of Hanu Reddy Realty, said a 2BHK is available today in areas like BTM Layout, the eastern IT corridor of Whitefield, and south Bengaluru's JP Nagar for ₹30,000-35,000 per month. About a year ago, the same rentals were about ₹38,000-40,000 per month.

However, areas like Koramangala and Indiranagar continue to command a rent of ₹40,000 monthly and above for a 2BHK.

Other areas, such as North Bengaluru, command rents between ₹25,000 and ₹35,000, as do areas like Hebbal, Jakkur, and Devanahalli.

Inventory improves

With more inventory becoming available, Bengaluru's rental market is seeing a shift. Data from Cushman and Wakefield revealed that in the October-December period, the city saw the launch of around 10,500 new units in Q4, marking a nearly 17% quarter-on-quarter growth and a 3% increase compared to the same period last year. North and East Bengaluru led the way in new launches, accounting for 37% and 31% of the total, respectively.

Additionally, data from real estate consultant ANAROCK showed a 2% increase in available residential inventory between July and September, bringing the total to approximately 46,300 units.

IT corridor sees surge in rentals

Real estate experts predict significant rental appreciation in 2025 across the outskirts of Whitefield's eastern IT corridor and North Bengaluru.

They say that rental prices in prime areas like Whitefield and Sarjapur, highly sought after by tech professionals, have surged by nearly 20-25% over the past two years.

"This spike has driven many to relocate from the IT corridor to more affordable outskirts. Areas like Glenwood Layout and Varthur Road remain in high demand due to their proximity to the IT hubs. In recent months, we've seen a surge in inquiries for these locations, particularly from those planning to move to Bengaluru," said Sunil Singh, director of Realty Corps.

Manjesh Rao added that 2BHK rents in the outskirts of North Bengaluru's Devanahalli and the eastern IT corridor of Whitefield have reached over ₹28,000-30,000 per month. "This is a notable rental appreciation, considering these areas are quite far from the city centre, and prices are expected to rise further," he added.