Bengaluru sees 4th highest residential price growth globally: Knight Frank

Bengaluru: Bengaluru has emerged as the fourth most expensive city globally in terms of annual house price rise, following Seoul, Dubai, and Tokyo, as of March-end 2025.

Bengaluru’s residential market topped amongst Indian cities with an  8.3% rise in prime residential prices from April 2024 to March 2025, according to a report by property consultancy Knight Frank on Tuesday. On a quarterly basis, Bengaluru saw a 7.2% price growth.

The city’s consistent price growth reflects strong end-user demand, particularly for higher value housing among domestic buyers, according to the report.

“As interest rates soften and buyer sentiment strengthens further, we expect prime residential demand to remain resilient and forward-looking,” said Shishir Baijal, Chairman and Managing Director, Knight Frank India.

Seoul, which was first globally, saw an annual surge of 18.4%, followed by Dubai (16.4%) and Tokyo (15.5%). These were the only cities to see double-digit growth.

Mumbai is fifth globally with a 7.6% annual rise, and Delhi ranks at 15 with a 3.9% growth, as of March-end. The average annual price growth across all 45 global cities considered stood at 2.8% for January-March (Q1) 2025 period.

There was also a slight slowdown from the 3.2% recorded in Q4 2024, suggesting that while the recovery in prices continues, momentum remains modest and uneven, according to the report.

This level of growth also remains noticeably below the long-run trend rate of 5.3%. While expectations of interest rate cuts have risen outside of the US, greater clarity on the pace and extent of future cuts is needed before there is significant upside in pricing in most housing markets, the report explained. Although inflation has been easing in many key economies, US policy on tariffs has created the potential for significant future volatility.

In fact, major Western markets like London and Toronto saw minor declines.

Still, this marked the eighth consecutive quarter of upward growth, following the trough of -0.6% in Q1 2023. 72% of the cities tracked in the index recorded positive annual growth in Q1 2025, with cities in Asia-Pacific and the Middle East continuing to lead. Prime residential markets were studied in these cities.

Quarter-on-quarter, prices rose by 0.8%, the strongest showing since Q2 last year. Overall, price growth is being sustained by a mix of wealth-driven purchases and constrained supply, but investor sentiment is still tempered by global macroeconomic uncertainty.