Business Economy

Hyderabad now 2nd most expensive residential property market in India: report

Hyderabad, Oct 18 (UNI) Amid a steady rise in average values of property that have now made the City of Nizams the most expensive housing market in India after the Mumbai Metropolitan Region (MMR), demand and supply metrics also indicate that a complete recovery is imminent for Hyderabad real estate.
According to Real Insight (Residential)-July-September (Q3,2021), a quarterly analysis of India’s prime residential markets by property brokerage firm in a report said, average property value of new property in Hyderabad has risen annually by 3 per cent in the July-September period of 2021 (Q3 2021), bringing the per-square-foot property rate to Rs 5,751.
The report shows that, in terms of average rates, this annual appreciation has now made Hyderabad the most expensive property market after the Mumbai Metropolitan Region (MMR), where the average rate stood at Rs 9,670 per square feet.
Despite the price rally, demand for property in Hyderabad continues to be robust--- this is reflected not only in the sales numbers but also in the city’s inventory profile.
During the July-September quarter of 2021, a total of 7,812 units were sold across the city, demonstrating an upswing of 222 per cent quarter-on-quarter and 140 per cent year-on-year.
Localities where the majority of the sales were concentrated in this quarter included Bachupally, Tellapur, Gandipet, Dundigal and Miyapur, etc.
The healthy demand for property in Hyderabad has helped the city, also known as the pharmaceutical hub in India, maintain a good inventory profile.
Despite an unsold stock consisting of 50,103 units, Hyderabad has the lowest inventory overhang of 25 months, the report shows. This is reflected in the fact that even though Kolkata has a lower inventory stock (see table), it has a much higher inventory overhang when compared to Hyderabad.
Inventory overhang is the estimated period builders would take to sell off the unsold stock in any particular housing market. This period is estimated based on the existing sales velocity.
Developers also launched 12,342 fresh units in the Hyderabad housing market in Q3,2021—an increase of 40 per cent over Q2 2021, and an appreciation of 189 per cent over Q3, 2020. Over 36 per cent of the new units launched in Q3, 2021 were in the price bracket of over Rs 1-crore category, with maximum share of units in Rs 1-3 crore.
Dundigal, Tellapur, Gopanpally, Bachupally and Bandlaguda Jagir were the top localities that witnessed the highest new supply in this quarter, the report said.
Mr. Rajan Sood, Business Head, said, “Considering housing affordability is at a record high this festive season on the back of 10-year low home loan interest rates and sops offered
by some state governments in the form of reduced stamp duties and circle rates, we expect housing markets in top 8 cities to show solid stability in the ongoing quarter.
He said though the overall cost of construction has gone up due to the rise in crucial input material cost, buyers are still being offered discounts temporarily instead of otherwise resulting increase in prices.”
“States can support the recovery process further by either announcing newer incentives for homebuyers or by extending or launching stamp duty and circle rate waivers,” Mr. Sood added.
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