Bangalore (Bengaluru) has always been an investor's paradise. Good educational facilities and employment opportunities have made people from all over the country choose Bangalore as their home. Most of the people who come to the city look for residential rental options and the city has every provision to cater to the demand for each and every customer requirement.

The rentals trends for residential apartments and homes for all budgetary needs are encouraging. The residential market in Bangalore, like most cities is split into the high-end (upper) segment and the budget (middle) and economy (lower) segment. Like in most cases, the upper end prime residential market is not witnessing much activity, while there is a reasonable amount of activity in the middle and lower segment.

Rental Homes: However, there has been a rising demand for transactions of rental homes like independent residential units (bungalows, etc). This segment which caters mainly to the high-end clientele has now many options to offer like the villas, penthouses and condominiums. These rentals homes, generally taken on company lease are preferred by the top notch executives of the MNCs and corporates these rental homes come with added facilities like gym, clubs, pools etc.

Rental Apartments: Apart from independent houses, rentals apartments and flats are the most sought after rental properties in Bangalore. This segment caters to a wide range of customers who can opt for budget apartments as well as high-end luxury apartments. Within the city, several larger plots are being converted into premium apartments targeting high-end clients. These projects are expected to add approximately 4, 50,000 sq.ft to the existing residential supply.

Service Apartments: Another thriving sector in Bangalore residential rental segment is service apartments. Due to the large influx of people on business to the city, Bangalore has always been a centre of activity, where hotel rooms are always booked and also highly charged. Moreover, Service apartments serve as a viable option for people who seek to stay away from the monotony and restricted environ of a hotel room; specially if it for a prolonged stay.

Serviced apartments also referred to as leased corporate housing, or interim accommodation pertaining to business rentals; provide the client with fully furnished and equipped apartment with facilities and services - that's ready to move in and stay. Service apartments are available from a few days to a year depending on priority and availability.

Broad Outlook
The prime residential areas in the city have witnessed a marginal decline in fresh construction activity due to the shortage of appropriate land parcels for development. And this has led correspondingly to the escalation in capital values of premium apartment by 15%-18%, and similarly the rental rates.

If we have a comparison on the residential values for apartments in the city, it is seen that capital values are in the range of USD 64.3 to 120 per sq. ft while rental values are in the range USD 4.6 to USD 7.1 per sq. ft per annum.

Rentals in Whitefield have increased marginally ranging between Rs.6-7 per sq.ft per month due to increased demand for residential space; while rentals in the peripheral areas of Airport Road and Koramangala are in the range of Rs.12-14 per sq.ft per month. Rentals in prime residential locations such as Central Bangalore and Palace Orchard too have gone up by 5-7 per cent and are ranging between Rs.15-17 per sq.ft per month.

Since the last quarter, rental and capital values in the suburbs have increased by 10-15 per cent due to high demand for residential space. However, yields on residential property remain between 4-6 per cent.