Hyderabad reported a marked improvement in the demand-supply dynamics of plotted developments in Jul-Sep 2018. 99acres.com delves into the market trend and analyses the key factors backing the increased popularity and availability of land property in Hyderabad.
Hyderabad’s realty market continued to showcase a steady growth in Jul-Sep 2018. While the supply of additional housing units remained muted, demand reported an uptrend. Not only the residential apartments but plotted developments also witnessed increased traction.
According to 99acres.com Hyderabad Insite Report , “Hyderabad witnessed a spike in property enquiries from Non-Resident Indians (NRIs), a section of buyers who had withdrawn from the Indian realty market after the demonetisation move in November 2016.”
The improved market sentiment coupled with the successful implementation of Real Estate (Regulation and Development) Act 2016 (RERA) and the State level Authority led to the revival of investors, both within the country and overseas. As per the report, plotted developments have not only witnessed a hike in the capital values, QoQ but also supply. The quarter recorded a five percent hike in the supply of affordable properties, with land parcels priced within Rs 10-25 lakh contributing maximum to the inventory share.
Factors responsible for the increased demand and supply of plotted developments in Hyderabad are:
Re-entry of NRI investors
NRI investments in India are largely restricted to markets that score high on parameters such as high livability index, ease of doing business, favourable investment climate and expanding commercial and infrastructure base. Since Hyderabad scores high on all these parameters, it remained the prime choice of the NRI community. Currently, it is one of the most-sought-after IT/ITeS hubs in the country after Bangalore owing to an increased supply of quality office spaces, lower leasing values and inexpensive skilled labor. These promising factors have earned it a global reputation and added to its realty growth.
Jayashree Koppula, Company of Leading Real Estate, Hyderabad, shared that NRI demand was mainly restricted to land parcels in the city outskirts for three reasons- lower land prices, availability of land tracts and high Return-on-Investments (ROI). Since land prices escalate faster than built-up properties, therefore, plotted developments were preferred over housing units. Also, if required, land can be converted and used for other purposes, thus offering multiple advantages.
Affordable values and infrastructure expansion
The peripheral pockets of the city near the Outer Ring Road (ORR) or beyond witnessed maximum demand. Key localities include Uppal, Beerumguda, Tellapur, LB Nagar, Shamshabad, Raidurg, and Manikonda. Proximity to IT/ITeS hubs, International Airport, and the ongoing infrastructure developments ushered the popularity of plotted developments near these areas. For instance, Uppal in the East of Hyderabad has been proposed to be developed as the next IT hub of the city and is bustling with infrastructure expansions. Also, a few industries have been planned in the adjoining areas of Uppal. The State government even mulls to augment the connectivity of Uppal Junction to Yadadri, which is being developed as the country’s biggest textile park.
From the supply standpoint, the local experts feel that the anxious politicians could have put their land for sale to meet the election expenditure. It is a common trend around the State elections, not only in Hyderabad but neighbouring cities, too.
Overall, demand for land parcels has reported an upswing in Hyderabad. Easy availability of land parcels and lower prices have worked in favour of the investor community. However, it is imperative to do the due diligence before investing in the plotted developments as they are prone to encroachments. Especially, if you are an NRI, do delve into all necessary papers and demarcate the property with a fence or a boundary wall to dodge site encroachments and future conflicts.
Disclaimer: The views expressed above are for informational purposes only based on industry reports and related news stories. 99acres does not guarantee the accuracy, completeness, or reliability of the information and shall not be held responsible for any action taken based on the published information.