The health of real estate cannot be different from the health of businesses progress in the city.The health of business has a lot to do with the sense of a well- ruled city, and a population that is optimist about the future course in the bifurcation. The inflow of new industries has slowed down, in a city that has been preparing for exactly that for years now, and has planned huge areas of land only for that tenacity.
Other than the current political scenario, a great deal of the lethargy in Hyderabad’s property market is due to the fact that the market currently supports 50-65 lakh support housing. With a lot of land bought at the 2007 prices of 25-35 crore per acre in high-end Hyderabad, and the rise in construction costs, these numbers become useless.
On the real estate sector, it is well known, that the premium segment Hyderabad structures have been experiencing sluggish development. While the top middle-rung developers in the city area have sold a majority of their inventory, they are waiting and watching before commencing new projects, as pricing has become a big factor in recent past.
Even in commercial office space, take Knowledge City for example, where land was bought at 18-20 crores per acre, the bare minimum rents needed have become unrealistic with IT rents soaring around Rs 40 psf currently. Companies worldwide wait and watch to see governments behaving in a responsive way to changing circumstances.
According to a survey, the buyers in the Hyderabad market are only genuine home buyers, or genuine CRE users. People parking money for further infusion have almost vanished form the market.
Just recently, an established builder of 15 years, with no stock available, had been scouting for PE equity, and inspite of reaching out to 17 PE Funds, could not solicit interest in even one.