Invest in Real Estate in Bangalore: A Fertile Ground for Rental Yield in India

By LODHA

Purchasing your first home is a dream come true and a life milestone. You can finally live in a space of your own and design it to your liking. But why stop there? Real estate can be an excellent investment and add tremendous value to your portfolio. Not only is it a great way to invest surplus income, but putting those properties on rent also helps you earn additional funds. Choosing a property in carefully researched locations can help you fetch substantial rental yields. While metropolitan cities like Mumbai have long been associated with higher rental yields, over the last couple of decades Bangalore has emerged as a strong contender. With its stronghold as the IT hub of India, the vibrant city provides several opportunities for real estate investment and earning a steady income through high rental yields. 

Leveraging the High Rental Yield in Bangalore  

The year 2022 saw the after-effects of the third wave of COVID-19 mitigated and a semblance of normalcy restored. As a result, lockdowns and restrictions were lifted and with things opening up like before, the demand for residential rentals also rose. Bangalore was no exception to this sweeping tide of change and has experienced a significant surge in rental values. 

Anarock, a real estate services company, analyses monthly rents in India's top 7 prominent areas and concluded that certain locales of Bangalore witnessed the highest growth. The first quarter of 2023 have showcased a jump of 24% when compared to last year. The report indicated that a standard 2 BHK's rent in Bangalore's Thanisandra Main Road increased from Rs 21,000 in the first quarter of 2022 to Rs 26,000 in 2023. Similarly, the average rental yield for homes at Marathahalli-ORR jumped from Rs 22,500 to Rs 28,000 in the first quarter of 2023. 

The director and head of research at Anarock spoke about how Bangalore has emerged as a standout amongst the top 7 cities in terms of rent. He further speculates that the rental values in Bangalore's prominent markets will only rise, going up to anywhere between 5-12% in 2023. This jump in rental values does hinge on the choice of location, type of property, the builder, and other variables. 

Overall, the end of quarter 1 of 2023 has shown Bangalore to provide one of the highest rental yields in the country at 4.1%, followed by Mumbai at 3.9%.  

Real Estate Investment in Bangalore: Areas with High Rental Yields  

If you want to invest in a home or apartment in Bangalore and make the most of the uptick in rental value, then these are the localities you should consider: 

Whitefield 

Popularly known as one of the top 3 rental localities in Bangalore and India, investing in Whitefield can help you enjoy a higher rental yield. The area has witnessed a hike in property prices over the last few years and the real estate market in the locality is booming. With world-class infrastructure, the presence of various IT giants, plenty of connectivity and recreational opportunities, Whitefield is an in-demand locality. Putting out flats for rent in Whitefield helps you earn a rental yield of 7%. 

Manyata Tech Park  

Residential rental values on Thanisandra Main Road, near Manyata Tech Park, and Marathahalli-Outer Ring Road tech corridor have seen a 24 percent increase in the last year, according to a realty report.  This locale is not just a flourishing tech and business hub but also an increasingly favoured destination for residential living. With a multitude of IT and corporate offices and the introduction of diverse amenities like shopping complexes, dining spots, and recreational facilities, a vibrant and dynamic lifestyle takes shape. With verdant spaces, meticulously maintained infrastructure and a strategic location, the overall living experience is elevated to new heights. 

Lodha Mirabelle, an upcoming development in Manyata Tech Park is an urban paradise set across a breathtaking 19-acre ecosystem, where residents enjoy the fine symphony of nature and luxury. This residential development features a verdant central park, a sprawling oasis of calmness and peace. Residents are treated to a lavish 45,000 sq. ft. clubhouse within this haven, dedicated to relaxation, rejuvenation and entertainment. 

Sarjapur 

If you want to put out a flat or house for rent in Bangalore, then Sarjapur is a name that is sure to pop up. Over the recent years, localities in Sarjapur have become popular investment sports for those who want to buy a home in Bangalore. The region is adorned with IT companies, startups, infrastructure developments, and seamless connectivity to key areas such as Outer Ring Road, Silk Board, Electronic City, and more. Investing in real estate in Sarjapur presents an opportunity to enjoy a rental yield of approximately 6%.

Bellandur 

Situated in South Bangalore, Bellandur has generated a rental yield of 7%. The locality is well-connected to several commercial hubs and the suburban railway system. With developments in infrastructure and the road network, the real estate market in the area is likely to get even better. 

Banerghatta 

With a rental yield of 7%, Bannerghatta is a thriving residential area that seamlessly combines urban convenience with natural serenity. It is known for its lush greenery and proximity to the Bannerghatta National Park. The locality boasts a range of residential options, from spacious apartments to luxurious villas, catering to diverse preferences. With well-established educational institutions, healthcare facilities, and shopping centres in the vicinity, Bannerghatta offers a balanced and convenient lifestyle. The area has witnessed significant infrastructure development, enhancing connectivity and further contributing to its appeal as a sought-after residential destination in Bangalore.

Electronic City 

One of the most popular IT hubs in Bangalore, Electronic City has grown from a locality with few residents to a thriving real estate market. The area has become a popular choice amongst millennials looking for a home due to its proximity to various commercial zones. Helping professionals cut down on time spent commuting, the area is safe and equipped with excellent infrastructure development. Investing in a property in the area could help you enjoy a rental yield of 7%.