Property trends in Hyderabad.
The past nine months have been extremely challenging for the Indian real estate sector which witnessed a serious meltdown in the second half of last year and the beginning of this year. The meltdown affected every constituent of the real estate segment, including builders and property seekers. While builders were unable to raise capital for their projects, property seekers were deferring purchases due to job uncertainties and future earning prospects.
However, over the last three months the scenario has taken a positive turn and the sentiments in the real estate market are echoing some initial signs of revival. Property seekers, who were inactive and were postponing their decisions, are now turning active.
This national trend is also echoed in the Hyderabad property market. A comprehensive study was conducted by Makaan.com on the behaviour of property seekers during the January'09 to July'09 period. During this time the number of property seekers in Hyderabad grew from 72,421 to 99,216. This is a healthy 37 per cent increase over the last 6 to 7 months. Most of this increase, however, came in from April to July. This confirms the fact that realty is recovering albeit slowly. The study also revealed some other interesting trends regarding Hyderabad's real estate sector market. Over the last 6-7 months, we observed an increase of 4 per cent in the demand for affordable housing (housing under 40 lakh) in the city. The total number of seekers looking for affordable housing has grown from 81 per cent in Jan'09 to 85 per cent in July'09. The changes in seeker preference in other budget categories are marginal or negative. The demand for housing in the Rs 40 to 75 lakh and Rs 1 to 2 crore range has actually seen a drop of 2 per cent with the maximum demand for affordable housing coming from Greater Hyderabad (from 84 per cent in Jan'09 to 89 per cent in July'09) and Secunderabad (86 per cent in Jan'09 to 88 per cent in July'09).
Although 85 per cent of property seekers would like to buy houses under Rs 40 lakh, the supply of property in this segment is limited. Hyderabad based builders have traditionally focused on the high-end and luxury segment, which has limited/no demand in the current scenario. The encouraging thing is that developers are now re-looking at their existing strategies and are introducing more projects in the affordable housing category, which is seeing the maximum growth in demand.
With the economy showing signs of revival, the real estate market has again started to pick up pace amongst property seekers. Makaan.com believes that there will be another surge in demand — something that the realty sector was experiencing before recession set it.