A $1 million check buys less Bengaluru luxury space now: Knight Frank

A surge in luxury home prices has eroded buying power in Bengaluru’s prime residential market, with $1 million now purchasing about 4% less space than a year ago, even as the city climbs sharply in global rankings for price growth, according to Knight Frank.

Data from the property consultancy’s latest Wealth Report showed that $1 million could buy 357 sq m of prime residential space in Bengaluru in 2025, down from 370 sq m in 2024 — a 3.5% year-on-year decline. The drop came despite a roughly 4.3% depreciation in the rupee over the same period, which would typically enhance purchasing power for dollar-denominated buyers.

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However, a 9.4% rise in Bengaluru’s luxury residential prices more than offset the currency advantage, tightening affordability at the top end of the market.

The city also emerged as one of the fastest-growing prime residential markets globally, climbing 32 places to rank 8th among 100 cities tracked in Knight Frank’s Prime International Residential Index (PIRI 100). The index recorded an average 3.2% rise in global prime housing prices in 2025.

Among Indian cities, Mumbai and Delhi also posted strong gains. Mumbai recorded an 8.7% increase in prime residential prices, improving its ranking to 10th from 21st a year ago, while Delhi saw a 6.9% rise, moving up marginally to 17th position.

Globally, Monaco retained its position as the most expensive prime residential market, where $1 million buys just 16 sq m, followed by Hong Kong (23 sq m) and Geneva (28 sq m).

Shishir Baijal, International Partner, Chairman & Managing Director, Knight Frank India, said, “India’s rise in the Prime International Residential Index highlights the growing strength of its luxury housing market, with Bengaluru, Mumbai and Delhi gaining global prominence on the back of rising wealth and strong demand. Globally, markets such as Tokyo and Dubai reflect how luxury real estate continues to be driven by capital flows and evolving lifestyle preferences. India remains well-positioned within this landscape, offering strong long-term growth potential.”

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Liam Bailey, global head of research at Knight Frank, said, “In many markets, prime residential property has pulled away from the broader housing sector, underpinned by the strength of wealth creation. While mainstream markets remain exposed to wider economic pressures, the pace at which wealth is being generated is helping to keep demand for luxury property more resilient, even against recent volatility in debt costs.

UHNWIs are increasingly organising their lives across multiple jurisdictions, with family offices actively managing tax, lifestyle and political risk. As a result, established hubs such as London are shifting towards a ‘dip-in, dip-out’ model: places to spend time for business, culture and connectivity rather than permanent residence.”

The report also highlighted India’s expanding ultra-wealthy population as a key driver of demand. The number of individuals with net worth above $30 million rose 63% between 2021 and 2026 to 19,877, making India the sixth-largest UHNWI base globally.

Bengaluru accounts for about 10.6% of India’s ultra-high net-worth individuals, reflecting its growing prominence as a wealth hub, while Mumbai continues to dominate with a 35.4% share.

Looking ahead, Knight Frank estimates India’s UHNWI population will grow a further 27% to 25,217 by 2031, signalling sustained momentum for the country’s luxury housing market.