Sale of houses fell by 18 per cent and there was also a fall of 30 per cent in new launches in Hyderabad last year (2014) when compared to the previous year (2013), reflecting the stagnation of the property sector in recent times, according to a report by real estate consultancy, Knight Frank.
The report, which analysed data on the real estate sectors in Hyderabad, New Delhi, Mumbai, Pune, Bengaluru and Chennai, showed that a total of 35,183 units were unsold in the residential market in 2014.
“The wait is in its last phase as buyers are anticipating price reduction. The end of the political issue is likely to revive markets,” said Vasudevan Iyer, director, Hyderabad, Knight Frank, at a press conference here on Friday.
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The only positive for Hyderabad from the report was that the city witnessed a significant increase in absorption levels of office spaces, which increased by 26 per cent in 2014, when compared with 2013. “The absorption includes the overall deals signed and security deposits issued. As of 2014, 4.7 million square feet is the absorption in the city, which is huge,” mentioned Mr. Iyer.
However, in spite of that, the vacancy levels in office spaces reached 17 per cent in 2014, which is the highest since 2012, and the city also recorded a negative growth of 26 per cent in new completions in 2014 when compared with 2013.
Also, the report showed that in the residential sector, Western Hyderabad occupies the highest share of under-construction inventory. “That is because areas towards the IT offices have more developmental activity due to the presence of IT companies,” mentioned Mr. Iyer. In total, there were 35,183 unsold units in 2014 in the city.
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Across the six cities in the residential market, the sales volume fell by 17 per cent, while new launches dropped by 28 per cent, showed the report. Around 2,34,930 residential units were sold in 2014 against 2,84,840 units sold in 2013. Similarly, the cities witnessed 2,68,950 new launches between the same period.
Mumbai witnessed a 43 per cent fall in new launches in the residential market last year when compared with 2013. Hyderabad came second with a 30 per cent drop in the same category in the same period. Vacancy in the office sector across the six cities also dropped from 19.6 per cent to 17.5 per cent. The report, however, said that all markets showed a positive price movement.