Bengaluru's Sub-Rs. 1 Cr Housing Crisis Deepens

Bengaluru homebuyers faced a sharp housing affordability crisis in 2025, with 42 percent of prospective buyers in the sub-Rs. 1 crore segment no longer able to purchase a home due to a steep rise in Bengaluru property prices, according to a NoBroker report. This affordability squeeze emerged even as budget housing demand in Bengaluru grew 13 percent year-on-year, highlighting a widening gap between demand and supply in the city’s residential real estate market.

Despite strong first-time homebuyer demand, housing supply below Rs. 1 crore has failed to keep pace. Developers are increasingly shifting focus toward premium housing projects to protect margins amid rising land costs in Bengaluru.

Key Highlights

1. 42 percent of sub-Rs. 1 crore Bengaluru homebuyers priced out amid rising property prices.
2. Budget housing demand rose 13 percent YoY, but supply continues to shrink.
3. Developers shift to premium projects, deepening Bengaluru’s affordability crisis.

This strategic pivot has led to a shrinking availability of affordable homes in prime city locations, pushing many middle-class buyers out of the primary market.

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According to NoBroker, resale housing in Bengaluru is offering limited relief, as some budget inventory remains available. However, in the primary residential market, affordability pressures have created a “real crisis” for middle-income homebuyers, forcing many to either defer purchase decisions or move toward peripheral areas of Bengaluru.

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Real estate experts note that the demand-supply mismatch is reshaping buyer behaviour. While buyers in the Rs. 1 crore-plus housing segment continue to find options, slowing job growth and economic uncertainty are lengthening decision cycles. As developers prioritise higher-margin real estate projects, the city’s affordable housing shortage is expected to persist, intensifying challenges for first-time and budget-constrained buyers in 2025.