H2 2016 sees marginal decline in Hyderabad residential market sales while new launches remain relatively steady; transactions at a five-year high:
Knight Frank India
Hyderabad, January 11, 2017: Knight Frank India today launched the sixth edition of its flagship half yearly report – India Real Estate. It presents a comprehensive analysis of the residential and office real estate market of Hyderabad for the period July to December 2017 (H2 2016).
Key Residential Takeaways:
Key Office Takeaways:
Speaking about the findings, Gulam Zia, Executive Director – Advisory, Retail and Hospitality, Knight Frank India said “The Hyderabad residential market withered over the last five years after peaking in 2012. While the city observed more than 22,700 units in new launches and 19,000 units in sales during 2012, these numbers have fallen by 49% and 21% respectively since then. The reduction in new launches and relatively stable sales volume helped in rebalancing the market to a great extent as the unsold inventory level dropped to its lowest level in the last six years. However, demonetisation disrupted the market sentiment and created a major dent on the residential market in Q4 2016 which saw sales plunge by 40%. In terms of micro markets, West Hyderabad attracts most of the development interest in the city, as its residential ethos and proximity to IT/ITeS and BFSI sector hubs such as HITEC City and Gachibowli continue to attract young IT employees that form the bulk of the city’s workforce. We believe that the 2016 would have been marginally better than 2015 had it not been for the demonetisation move, as the sales numbers for the first nine months were showing positive trend.
The Hyderabad office market witnessed its highest yearly office space transaction in 2016. Nearly 6 mn sq ft of office space was transacted during the year, which was 31% higher than the 4.6 mn sq ft mark achieved in 2015. Hyderabad boasts excellent infrastructure, both existing as well as planned. It is also the most affordable residential market among the country’s top seven cities, which has been instrumental in attracting a large talent pool. The recently-unveiled Telangana IT Policy offers a number of incentives for the expansion of the IT/ITeS sector in the state, which will impact Hyderabad positively. The state government is also focusing strongly on attracting new investments to Telangana.”
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