Realty on the upswing in Hyderabad city

47% rise in number of residential units in first quarter of 2019, says Knight Frank report

July 10, 2019 01:16 am | Updated 01:16 am IST - HYDERABAD

There is more good news on the real estate front for Hyderabad with the number of residential units increasing by 47% in the first quarter of this year, with 5,430 units when compared to 3,706 in the same period last year.

Interestingly, property prices rose by 9% on an average of ₹4,373 when in all other cities there has been a decrease in real estate prices even below the inflation rate. Maximum sales occurred in the west — Madhapur, Kokapet areas of the city accounting for 63% of the overall sales but this comes at a reduced share when contrasted with last year with north parts — Kompally, Alwal, Qutbullapur, etc gaining traction.

If stable political climate and good infrastructure has propelled the growth, close to 200 properties are awaiting environmental clearance and there are issues with regard to “interim Real Estate Development Authority (RERA)” and “confusion with regard to GST implementation”, according to property consultants Knight Frank India Hyderabad branch director Samson Arthur.

Making a presentation on ‘India Real Estate 11th edition’ here on Tuesday, Mr. Arthur said total residential unit sales in Hyderabad this year so far has been 8,334 and it was 15,591 units in whole of 2018. “It would have been much better if the environment committee had been in place as there would have been more new launches,” he said. Demand is mostly for units in price range of ₹25 lakh to ₹75 lakh even as there was considerable market for ₹2 crore costing units.

New launches happened in Pragathinagar, Bolarum, Bachupally, Tellapur, Kokapet, Yapral, Bandlaguda, Shadnagar and Nanakramguda with preference for units that are ready to move in or those to be completed within six months. Reputed builders too have been more in demand.

Proximity to the office locations like the financial district, Madhapur, Gachibowli and Kondapur coupled with robust infrastructure were major pull factors for home buyers.

Unsold inventory has been 4,265 units, a drop of 67%.

Prices to rise further

The report forecast that the prices are likely to be pushed up further because of mismatch created in demand and supply. All this is also because this has been the “best period” for new office space completions with 129% increase of 3.97 million sq.ft up from 1.73 million sq.ft last year.

Volume too has risen by 43% to 3.85 million sq.ft from 2.69 million sq.ft.

Mr. Arthur said vacancy levels were at a low of 7.13% with those in HiTec City and its environs seeing as low as 2-3% as IT/ITeS sector accounted for 41% of transacted space.

Demand and lack of vacant office stock has pushed the average rentals to ₹59 per sq.ft, a 11% hike. Madhapur regained position as most preferred business district with 67% share and demand is expected for Kokapet, Nanakramguda and Poppalguda.

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