Posted By Khushi Pal
Published Apr 25, 2024

Hindustan Times
Real Estate

Photo Credits: Pexels

Bengaluru water crisis: Has it impacted real estate sales and rentals?

Construction activity and the Bengaluru water crisis

Much of the blame for the water crisis in Bengaluru lies with the rampant construction across the city. 

Construction sites across Bengaluru constitute a major proportion of water consumption, mostly met through borewells. This has led to the depletion of groundwater tables in several parts of the city.

Impact on housing sales

Housing sales in Bengaluru have dipped by 2% to 13,133 units from 13,390 units in the year-ago period due to a reduction in sales in the affordable category even as the office demand in the IT city remained flat at 3.5 million square feet, a report by Knight Frank has said.

The less than 50 lakh housing segment has seen a sales decline by almost 65% to 70% in the first quarter of 2024 which has brought down the overall numbers. The sales in the 50 lakh- 1 crore residential segment has dipped by 7 percent. 

Impact on housing rentals

In localities that do not have access to direct water supply from the Kaveri, apartment owners are finding it difficult to find tenants. The number of people scouting for rented accommodation in these areas has also come down drastically.

IT capital left high and dry ahead of peak summers

Just as property prices in Bengaluru were impacted during the monsoons in 2022, experts say that the ongoing water crisis may also dent real estate markets in areas located close to the IT corridors. 

What more needs to be done?

Experts say that the city needs to work towards removing encroachments on water bodies; impose penalties for those not adhering to rainwater harvesting rules and last but not the least reuse sewage water.