Hyderabad: Proving skeptics wrong to a large extent, real estate sector in Hyderabad and across Telangana bounced back with a renewed vigour in last four years, leading to significant spurt in sales of open plots as well as flats.
Realty on fast-track growth
The sector insiders say land prices went up by almost 20 per cent in the past one year alone while residential apartment space witnessed escalation in prices of as much as 30 per cent in the past four years. The sales have gone up by 10-12 per cent on an average every year since 2014.
"Real estate sector is doing extremely well in Telangana. Realty boom has already started in Hyderabad.
This is likely to continue for next three to four years. Land prices are going up everywhere as demand picked up," Chairman & Managing Director, Gowra Group of companies, and president, Federation of Telangana and Andhra Pradesh Chambers of Commerce and Industry, told The Hans India.
According to him, demand for commercial space has increased to such a level that getting commercial space has become a difficult task now. Perhaps, anticipating this kind of boom for commercial realty, Gowra Real Estate, a part of Gowra Group, paid a record price of Rs 42.59 crore per acre for a land parcel in upscale Raidurg in Hitech City, auctioned by the Telangana State Industrial Infrastructure Corporation (TSIIC) in May 2017.
On the reasons for revival in this sector, he said real estate sector went through sluggish phase for over four years before the bifurcation as uncertainty prevailed. "Many people preferred Bengaluru during that period as real estate business came to a standstill in the city. With the government developing infrastructure and providing uninterrupted power supply post the bifurcation, things started looking up again and the sector is fully-back on track now," he explained.
Developers also say new industrial policy, TS-iPASS, announced by the Telangana government in 2015 and concerted efforts on law & order front had also played key role in the growth of real estate sector. “The growth of real estate is obviously linked to new jobs created in industrial and IT sector.
With Telangana attracting investments in industrial and IT sectors thanks to TS-iPASS, large number of new employment opportunities have been creating. As result, apartment sales have gone up by 10-12 per cent annually while prices have appreciated by up to 35 per cent,” C Shekar Reddy, former national president of real estate body Credai.
Hyderabad also has cost advantage compared to other big cities in the city. “Prices here are almost 60 per cent cheaper than Bengaluru. The difference is much higher when compared with other metros,” Shekar Reddy said.
However, some attribute sudden rise in real estate prices to price correction during the Telangana agitation. "Prices of apartments and land have fallen for over four years during the agitation. The trend has reversed post bifurcation," said N Jaiveer Reddy, Managing Director, Ashoka Developers & Builders.
He however felt that for the boom to continue, the government should further improve infrastructure in the city. "Traffic congestion is a big drag on Hyderabad," he said. Nevertheless, the realty boom paid rich dividends to the government. Income from property registrations went up from Rs 3,105 crore in FY16 to Rs 4,202 crore in FY18.