Bengaluru’s real estate sector’s fortunes are linked to IT salaries, say netizens

Bengaluru’s real estate faces pressure as IT job cuts, inflation weigh on demand. Flat prices historically doubled only when tech salaries surged, say netizens

Bengaluru’s soaring real estate prices are facing a critical test: the stability of its IT workforce. As tech job growth slows, the ripple effects could shake not only the housing market but the broader economy, from construction to retail. Reddit discussions highlight the potential fallout, noting that historically, flat prices have only doubled when IT salaries have surged. This happened in the 2000s and again around 2021.

Bengaluru’s soaring real estate faces a test as IT job growth slows. Historically, housing prices doubled only when tech salaries surged, sparking concern. (Representational Photo) (Unsplash )

For every IT job lost, it’s estimated that 10 others will feel the economic impact. Industries like construction, retail, education, food services, and even transportation will also face the consequences. With a heavy reliance on the IT sector, the city’s property boom may hinge on how resilient this engine of growth remains, say netizens.

Redditors point out that Bengaluru’s housing cycles have historically mirrored trends in IT salaries. “Flat prices double only when IT salaries double. It happened in the 2000s and again around 2021,” one online commentator noted, pointing out that the city’s real estate bull runs coincided with global outsourcing booms in the Y2K era and during the pandemic surge in digital services.

With the US HIRE Act (Halting International Relocation of Employment) and advances in artificial intelligence expected to reduce outsourcing, some fear the trend will reverse. “Walk into any large gated colony today in Bengaluru, 30% of the uncles there don’t have jobs. Most of them were at the ₹90 lakh to ₹2 crore salary range,” another user wrote in a widely discussed thread.

Ripple effects beyond housing

The impact, stakeholders warn, would go far beyond apartments and villas. “If IT jobs reduce, real estate will be directly hit. But builders, architects, cement and steel makers, schools, restaurants, and even auto drivers will also feel the pain,” said a Bengaluru-based property analyst. “For every IT job lost, there are 10 others whose income will be affected.”

Others caution that the fallout could extend to the macroeconomic level. Without outsourcing revenues, India’s dollar inflows would shrink, weakening the rupee and raising the cost of imports, especially oil. “Construction costs will shoot up with inflation. Developers may shelve ambitious projects, and while property may look cheaper in dollar terms, it will cost more in rupees,” one investor remarked.

Netizens share a divided outlook on Bengaluru’s real estate amid the IT sector’s uncertainty

Not everyone shares this pessimism. Some argue that Bengaluru’s IT professionals have built strong buffers, from US stock options to diversified investments. “Thousands of freshers who joined multinationals two or three years back have already become crorepatis. People losing IT jobs are very smart, they won’t stay idle,” a forum participant countered.