Tech Layoffs 2025: Bengaluru PG Demand Falls, Property Values Decline As City's Housing Market Takes A Hit

Tech Layoffs 2025: Bengaluru PG Demand Falls, Property Values Decline As City's Housing Market Takes A Hit

  • 19.03.2025 18:56
  • news18.com
  • Keywords: Layoffs

Tech layoffs in Bengaluru have reduced demand for PG housing, leading to lower occupancy rates and falling property values. Amazon's recent layoffs of 14,000 employees highlight the financial strain on landlords and operators as affordable options become scarce.

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Context

Tech Layoffs 2025: Bengaluru PG Demand Falls, Property Values Decline As City's Housing Market Takes A Hit

Key Facts and Data Points:

  • Total layoffs in 2025 (so far): 23,054 employees across 87 tech companies.
  • Amazon layoffs: Approximately 14,000 employees, affecting engineering, marketing, and product management roles.
  • Historical layoffs:
    • 2024: 152,472 employees laid off by 549 tech companies.
    • 2023: Highest layoffs with 264,220 employees laid off by 1,193 tech companies.
  • Amazon restructuring goals:
    • Reduce managerial staff to increase the ratio of individual contributors to managers by 15% by Q1 2025.
    • Expected annual savings: $3 billion.

Market Trends and Business Impact:

  • Declining PG demand: Bengaluru's real estate market is experiencing falling occupancy rates and diminishing property values due to reduced demand forPG (shared housing), the most affordable option for junior IT employees.
  • Financial strain on landlords and operators: Falling demand for PG has led to financial difficulties for property owners and operators in Bengaluru.
  • Long-term effects:
    • The tech layoffs are expected to continue impacting the housing market, with potential prolonged low demand for affordable housing options.
    • Investors may face challenges due to vacant properties and declining asset values.

Competitive Dynamics:

  • Shift to AI automation: Tech companies have been reducing costs through layoffs and restructuring, driven by a shift toward AI automation.
  • Strategic considerations:
    • Companies are focusing on cost-saving measures, potentially leading to further market contraction in the real estate sector.
    • Operators may need to adapt by lowering prices or improving services to retain tenants.

Regulatory Implications:

  • Potential impact: While not explicitly mentioned, regulatory changes could influence the housing market dynamics, such as rent control policies or incentives for affordable housing development.

Future Outlook:

  • Market recovery: The real estate market in Bengaluru may take time to recover, depending on the pace of tech layoffs and overall economic conditions.
  • Investor sentiment: Declining property values and occupancy rates could deter new investments in the short term.