The formation of Telangana will bring in better days for many fields, including the real estate, say industry watchers. Most metros and tire two cities witnessed considerable drop in unit bookings but Hyderabad drops were not so alarming, said property consultant Knight Frank. Slow economic growth, high inflation, and higher interest rates added to the political instability have caused the dip in residential market across the country. But compared to similar cities like Pune and Chennai who also have a developing IT based industry environment, Hyderabad fared much better, the property consultant analysed.
“The Hyderabad residential market has remained stagnant in 2013, with a slight drop in absorption. The residential sales volume has dipped by 4 per cent in 2013 compared to 2012. Approximately 16,500 residential units were absorbed in 2013,” Knight Frank said in a report.
“Considering the recent decision on formation of a separate state Telangana the prevailing uncertainties will fade away. Clarity on this issue is expected to boost the absorption by the end of the year or early 2015,” the report added.
The area of price appreciation has been a concern though. Compared to other metro cities, Hyderabad market is giving very little value betterment to investors. “With only a 13 per cent increase in weighted average prices since 2009 the Hyderabad market has been the worst performer among the IT/ITeS driven markets. Bengaluru, Pune and Chennai have witnessed a minimum of 38 per cent increase since the year 2009,” the consultant said.
Yet this drawback could also turn out to be a boon for Hyderabad as it makes the city the most affordable area in the top seven cities of NCR, Mumbai, Bengaluru, Chennai, Pune and Kolkata, the report said.