Karnataka Budget 2026: Push to Develop Mysuru as Second IT Hub to Decongest Bengaluru, Experts Say Move Could Boost Real Estate Demand Beyond Capital
Bengaluru, March 7, 2026: The Karnataka Budget 2026-27 has proposed to develop Mysuru as Karnataka's second major IT hub in an effort to decongest Bengaluru and expand the state's technology ecosystem .
IT Hub Proposal
While presenting the Budget on March 6, Chief Minister Siddaramaiah said the state government plans to strengthen infrastructure and introduce supportive policies to attract technology firms to Mysuru, which is increasingly being considered by IT and IT-enabled services companies as an alternative base outside Bengaluru .
Real estate developers believe that the Budget's focus on decentralising growth from Bengaluru could encourage IT companies and startups to consider Mysuru as an alternative destination, which in turn may spur demand for office space, rental housing, and plotted developments in the region .
Housing Development Focus
The government also reiterated its focus on housing development across the state, with thousands of homes being completed under various schemes and additional support planned to accelerate affordable housing projects .
Siddaramaiah stated that 4,19,454 houses have been completed at a cost of ₹7,328 crore, with a target of 3 lakh houses this year. The government will also complete 4.9 lakh previously approved houses left unfunded by the previous administration .
Infrastructure and Connectivity
Ramani Sastri, Chairman and MD of Sterling Developers, commented: "The Karnataka State Budget reflects a continued emphasis on infrastructure development as a key driver of urban growth. The allocation for urban development, along with proposals such as a second international airport for Bengaluru and investments to strengthen domestic aviation infrastructure, are important steps toward improving regional connectivity and supporting the city's long-term economic expansion. Such initiatives can play a meaningful role in shaping new growth corridors and supporting the steady expansion of housing across the metropolitan region" .
Tier-2 City Growth Potential
Real estate experts say that if the government follows through with infrastructure and policy support, Mysuru could emerge as one of the key Tier-2 property markets in Karnataka over the next decade, benefiting from spillover demand from Bengaluru's saturated property market .
"The focus on city economic regions, Tier-II and Tier-III cities, ease of doing business, and employment generation will have a positive multiplier effect across sectors, including real estate and allied industries," said Jai Challa, CEO of Curated Living Solutions .
M R Jaishankar, Executive Chairman of Brigade Enterprises Limited, added: "Increased allocations for Bengaluru's long-pending infrastructure upgrades reflect a forward-looking commitment to strengthening the city's global competitiveness and reinforcing Brand Bangalore. Additionally, the focus on decongesting Bengaluru by developing tier 2 and 3 cities is a welcome and strategic move" .
Mysuru Real Estate Landscape
Long known as a quiet retirement destination, Mysuru is increasingly attracting professionals looking for second homes, thanks to its relaxed lifestyle, relatively cleaner environment, and improving civic infrastructure while still remaining well connected to major urban centres .
Local property brokers say neighbourhoods such as Kuvempu Nagar, Vijayanagar, and Jayalakshmipuram have become popular among working professionals because of their connectivity to the city's northern corridors. In these areas, prices for 2BHK apartments typically start around ₹60 lakh and can exceed ₹1 crore, while monthly rentals are estimated to range between ₹30,000 and ₹45,000 .
In contrast, localities such as Gokulam and Lakshmipuram, situated close to Mysuru's cultural and heritage zones, offer comparatively lower property prices. Brokers say 2BHK apartments here are usually priced between ₹60 lakh and ₹80 lakh, with rents generally in the ₹15,000–₹20,000 per month range .
On the outskirts, areas including Bogadi, Hebbal, and Nanjangud are witnessing growing interest from homebuyers seeking larger homes at relatively affordable prices. Apartments in these locations are typically priced between ₹3,450 and ₹5,400 per sq ft, with monthly rents for a 2BHK generally ranging from ₹20,000 to ₹30,000 .