HYDERABAD: Crushing the aspirations of prospective homebuyers, the real estate market in Hyderabad has witnessed a surge in prices, with the average cost of flats skyrocketing beyond Rs 10,000 per square foot, making it extremely unaffordable for the average individual.
According to the Housing Price-Tracker by Confederation of Real Estate Developers’ Associations of India (CREDAI), Colliers, and Liases Foras, the average price of residential properties in Hyderabad during Q1 reached Rs 10,410 per square foot. This places Hyderabad as the second most expensive city in the country, following Mumbai Metropolitan Region (MMR) with an average price of Rs 19,219 per square foot.
Despite the increase in interest rates, housing prices have been steadily rising due to consistent demand observed since the previous year. As interest rates are expected to stabilise and with a positive outlook for the domestic economy, the market sentiment is expected to remain optimistic.
The report highlights that housing prices in Hyderabad have consistently risen over the past nine quarters. Overall, housing prices witnessed a year-on-year surge of 13 per cent, with the central part of Hyderabad experiencing the highest increase at 55 per cent. Among different unit types, 4BHK units recorded the highest price hike at 23 per cent year-on-year, followed by 1BHK units.
Unsold inventory levels in Hyderabad escalated by 38 per cent year-on-year, the highest among the top eight cities in India. The surge in unsold inventory can be attributed mainly to the influx of new project launches, particularly in the northwest and southwest regions of the city, including Gachibowli, Kondapur, Nanakramguda, and Kokapet. Despite the increase in unsold inventory, housing prices in Hyderabad have consistently shown an upward trend over the past nine quarters.
Across the country, the top eight cities witnessed a rise in new project launches as developers aimed to cater to the growing demand. Consequently, the overall unsold inventory increased by 12 per cent year-on-year. The report also notes that approximately 95 per cent of the unsold units in the top cities were under construction.
CREDAI president Boman Irani said, “Despite the rise in housing prices, primarily driven by increasing raw material costs and sustained demand, we anticipate the strong momentum to continue as consumers have displayed a clear inclination to purchase new, larger houses with improved amenities, particularly in the post-pandemic era.”