Hyderabad real estate sees upswing in sales in 2018
Reflecting growing demand for residential units and commercial space in Hyderabad, housing sales in Hyderabad went up by five per cent and rentals...
Hyderabad: Reflecting growing demand for residential units and commercial space in Hyderabad, housing sales in Hyderabad went up by five per cent and rentals firmed up by eighter per cent in the first six months of 2018, according to real estate consultancy firm Knight Frank India.
The consultancy firm on Wednesday launched the ninth edition of its flagship half-yearly report - India Real Estate. It presents a comprehensive analysis of the residential and office market performance of Hyderabad for the period January – June 2018 (H1 2018).
“The worst seems to be behind us, and the real estate market of Hyderabad is expected to witness new benchmarks. Sluggish residential launches until now, due to policy issues, is soon set to transform with the announcement of several new projects. For the fourth year in a row, thanks to IT and co-working space, real estate continues to be in high demand by office sector in Hyderabad,” Samson Arthur, Director - Hyderabad, Knight Frank India, told the media here.
Benefits of robust office demand rubbing off on the residential sector is now distinct, with record 8,313 units sold in the first half of 2018, registering of 5 per cent in housing sales. The office market is expected to continue the good run for the second half of 2018 and this together should be a harbinger of another strong performance of Hyderabad amongst the key property markets of India, he added.
Knight Frank India Executive Director (North) Mudassir Zaidi told reporters said, “the drop-in prices intensified in Mumbai, Pune and Kolkata at 9 per cent, 8 per cent and 8 per cent, respectively. Effective price drop of 10-15 per cent continues in cities like Mumbai, NCR, Pune and Kolkata. Hyderabad bucks the trend with an exceptional price growth at 8 per cent year-on-year.”
Though the new completions were down 13 per cent in H1 2018 year-on-year, the report said that the good show of the office market continues in H1 2018 as transactions were up 15 per cent YoY.
While the average rentals grew by around 8 per cent on annual basis and want of quality office space pushed vacancy to abysmally low levels. Vacancy levels in markets like Madhapur, Hi-Tech City, Gachibowli and Nanakramguda area are as low as three to four per cent.
The share of the IT/ITeS sector shrinked to 36 per cent in H1 2018, while the share of ‘Other Services’ increased to 43 per cent in H1 2018 of which co-working garnered 29 per cent space, the report said. On the residential front, launches bounced back in H1 2018; up 44 per cent compared to H1 of 2017.
West Hyderabad continues to be the largest market accounting to 71 per cent of the new launches, the report said, and added that majority of new launches were in Rs 7.5-10 million price category.
The other factors contributing to Hyderabad as a favourite destination are - improved infrastructure and political stability, said the report. While west Hyderabad continues to be the biggest market witnessing 69 per cent of sales, unsold inventory declined 44 per cent year-on-year on the back of launches. The age of inventory is a major concern at 18.5 quarters, the report added.