Sales volume fell by 18 per cent in the residential market even as vacancy levels dropped to 17 per cent for first time since 2012 in the office market in Hyderabad during July-December 2014, according to a report by real estate research and brokerage firm, Knight Frank.
As per the second edition of Knight Frank India’s half-yearly report launched here, the residential market in
Hyderabad continues to lose steam despite political scenario (following bifurcation of Andhra Pradesh) easing out.
In the residential market, sales volume fell by 18 per cent with 15,111 units sold compared to 18,428 units while
new launches dropped by 30 per cent with 13,050 units launched as against 18,643 units in 2013,” the report said, adding West
Hyderabad accounted for the largest share of under-construction inventory.
The total unsold units stood at 35,183 as on December 2014 even as prices have grown by 5.6 per cent and cost
pressures rule out possible corrections, it said.
The change of guard at state government does little to improve the residential market, the report finding said,
adding that cash-strapped developers put the brakes on launches while looking to offload existing inventory.
Speaking about the findings, Knight Frank Director- Hyderabad, Vasudevan Iyer said, “The wait and watch period is
in its last phase, buyers anticipation of price reduction is fading away leading to a more positive approach towards
decision making. Top developers are gearing up to launch new projects in 2015.”
“With the end of political turbulence the Hyderabad residential market is likely to revive by end of 2015,” he
said.
On office market, the report said Deloitte (leasing deal leads the office market rebound) gives a new lease of
life to Hyderabad office market and absorption levels have shot up by 140 per cent year-on-year.
Receding share of the IT/ITeS sector has not affected overall absorption volumes, as consulting, designing and media
companies from the other services sector have been gaining a share in tandem, it said.
The report further said going forward the change in political regime get businesses back in the city.
“Absorption likely to be 3.3 mn.sq.ft. during January-June 2015, similar to that of H1 2014,” it said, adding the weighted average rental to rise by a nominal 5 per cent.
“With the long-awaited political stability dwelling, the office market has seen a high in 2014. 2015 looks brighter
from the demand side. Top developers have commenced construction in full throttle,” Vasudevan added.
————————-PTI