Currently in the middle of third quarter, Hyderabad’s real estate industry has seen little progress despite a slew of promises being made by the Telangana governemnt. To provide a better perspective, Jaiveer Reddy, managing director, Ashoka Developers and Builders, speaks to Express about the plight of developers in Hyderabad.
Excerpts:
How would you assess the progress by the real estate industry since formation of Telangana?
The government made a slew of promises but they are yet to implement them. They are constantly speaking about initiatives and development plans but they are not being implemented. They had promised us in our CREDAI meeting that some additional Nala charges are going to be removed. This has not been finalised. Chief minister K Chandrasekhar Rao himself had earlier instructed HMDA to remove these charges but the HMDA commissioner has not implemented it.
Have you seen any improvement in the residential sector?
If IT industry blossoms and the employment position improves, then we will see an improvement in the residential sector. Already if you see, compared to other cities, prices in Hyderabad are much lower. If you look at it from a national viewpoint, builders in Hyderabad are selling at 30 to 40 per cent lower rates than other cities. We are selling at a minimum margin and if the industry improves, only then the question of margin will arise. As of now, we are selling at a break-even rate. If it increases by another 20-25 per cent, the trust comes to the builder.
What are the prospects for the coming months? Do you see the situation improving?
Yes, prices will increase by 10 to 15 per cent in the next three months.
With the inception of outer and inner ring roads and flyovers in the city, we have good infrastructure compared to other cities. There is still plenty of space available for construction of residential, commercial and industrial property. Land availability is not an issue. We have good infrastructure and things would further improve with the Metro Rail and other projects.
What are the core issues that you are facing as developers?
The main challenge for us is that the HMDA is not giving us permissions. They have removed a lot of staff, so there is nobody to see the files. As a result, the files are not moving and the HMDA commissioner also is not co-operating. This situation needs to be addressed.