Andhra Pradesh Real Estate Sector Shows Signs of Recovery
The real estate sector in Andhra Pradesh, which has been struggling due to a prolonged market slowdown, is showing signs of recovery thanks to a series of proactive measures by both central and state authorities.
Real EstateAndhra PradeshGovernment MeasuresInfrastructure ProjectsMarket RecoveryReal EstateSep 13, 2025
Single-window clearance and relaxed norms for high-rise buildings have come as a major relief to developers. The central government’s decision to rationalize GST—reducing it from 28% to 18%—is expected to lower construction costs. Additionally, the reduction from four slabs to just two is likely to help curb inflationary pressures, providing prospective buyers with some relief through slightly lower prices. The cut in the repo rate, which makes housing loans more affordable, is further projected to boost demand.
For years, demand in the real estate sector has remained stagnant, first due to the pandemic and later due to delays in grounding infrastructure projects. The change of government in the state over a year ago, coupled with initiatives such as the Greenfield capital city at Amaravati, the international airport at Bhogapuram, tenders for metro rail projects in Visakhapatnam and Vijayawada, proposals to build ports every 50 km, and the expansion of national highways and inland waterways, are expected to provide a strong push to both residential and commercial real estate demand.
The local chapters of both the Confederation of Real Estate Developers Association of India (Credai) and the National Real Estate Development Council (Naredco) have welcomed these measures. They described the scrapping of the NALA Act as historic, as it enables hassle-free conversion of agricultural land for non-agricultural purposes. “This will be a game-changer for improving the industrial landscape across Andhra Pradesh,” said Potluri Bhaskara Rao, president of the AP Chamber of Commerce and Industry Federation.
The state has also introduced new norms under building rules, empowering urban local bodies and municipal authorities to issue building permits. This is expected to prevent delays, ensure transparency, and speed up project approvals. “We have been suffering due to weak demand in the real estate sector. With several infrastructure projects now at the grounding stage, we are hopeful of momentum in the near future. We are also banking on the Amaravati factor,” said Naredco state secretary M. Sitaramaiah.
Naredco is also optimistic about the 11th edition of the Amaravati Property Festival, scheduled from September 19 to 21, which it expects will boost market sentiment. Credai Andhra Pradesh has thanked Chief Minister N Chandrababu Naidu and the Group of Ministers for recently approving an increase in the height limit for non-high-rise buildings from 18 meters to 24 meters.
The change is expected to give developers greater flexibility in planning residential and commercial projects, promote efficient land use, and support sustainable urban density. The industry body also expressed gratitude to Minister for MA&UD P. Narayana and Minister for Revenue, Stamps & Registration Anagani Satya Prasad for playing a key role in facilitating these amendments. According to Credai representatives, the changes will streamline project approvals, reduce regulatory hurdles, and enable faster development timelines, providing a much-needed boost to the real estate and construction sector.
Highlighting broader reforms, Credai also welcomed the removal of NALA Act provisions and other recent regulatory measures. “These measures will benefit developers, homebuyers, and investors alike. We are committed to working closely with the government to ensure Andhra Pradesh’s cities grow sustainably and efficiently, with modern infrastructure that meets the needs of residents and businesses,” said Credai State president Bayana Srinivas Rao and general secretary D Rambabu. Secretary Dasari Rambabu added that these reforms are set to significantly strengthen the state’s real estate sector. Credai chairman Buddiga Srinivasu also conveyed his appreciation for the government’s decisions.
Frequently Asked Questions
What are the key measures introduced by the government to boost the real estate sector in Andhra Pradesh?
The key measures include single-window clearance, relaxed norms for high-rise buildings, a reduction in GST rates from 28% to 18%, and the scrapping of the NALA Act, which allows hassle-free conversion of agricultural land for non-agricultural purposes.
How is the reduction in GST expected to benefit the real estate sector?
The reduction in GST from 28% to 18% is expected to lower construction costs and curb inflationary pressures, providing prospective buyers with some relief through slightly lower prices.
What are the major infrastructure projects in Andhra Pradesh that are expected to boost the real estate sector?
Major infrastructure projects include the Greenfield capital city at Amaravati, the international airport at Bhogapuram, metro rail projects in Visakhapatnam and Vijayawada, proposals to build ports every 50 km, and the expansion of national highways and inland waterways.
What is the significance of the scrapping of the NALA Act for the real estate sector in Andhra Pradesh?
The scrapping of the NALA Act is significant as it enables hassle-free conversion of agricultural land for non-agricultural purposes, which is expected to improve the industrial landscape and provide more land for development.
How does the increase in height limits for non-high-rise buildings benefit developers?
The increase in height limits for non-high-rise buildings from 18 meters to 24 meters gives developers greater flexibility in planning residential and commercial projects, promotes efficient land use, and supports sustainable urban density.
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