Hyderabad's Real Estate Market: Is the Bubble About to Burst?
Amid growing concerns from developers, builders, and consumers, the recent shifts in Hyderabad's real estate market are raising speculations about the sales of existing stock and the impact of new project launches on inventory levels.
Hyderabad Real EstateProperty MarketHome SalesReal Estate BubbleHousing RegistrationsReal Estate MaharashtraOct 24, 2024
According to the latest assessment released by Knight Frank Research, Hyderabad registered a 34% year-on-year increase in home sales during January-September 2024. However, the same period saw a sharp decline in September 2024, with home sales dropping by 22% compared to September 2023. The data shows that while 6,304 units were registered in September 2023, this number fell to 4,903 units in September 2024. Similarly, the registration value decreased from Rs. 3,459 crore in September 2023 to Rs. 2,820 crore in September 2024.
Despite the September dip, the overall trend from January to September 2024 remains positive. Knight Frank's assessment indicates that Hyderabad registered home sales worth Rs. 36,461 crore, marking a 34% year-on-year increase. The number of registrations also saw a 13% increase, totaling 59,386 units.
The decline in September is attributed to the Shradh/Pitra Paksha period, a time considered inauspicious for buying or registering homes according to the Hindu calendar. This cultural observance likely contributed to the slowdown in home sales for the month.
Another notable trend is the growing premiumization in the market. Sales of homes priced at Rs. 1 crore and above increased from 9% to 14% during the first nine months of 2024. This shift suggests a growing demand for high-end properties, which could be indicative of a shift in market preferences.
In terms of property size, the majority of registered properties in September 2024 were in the 1,000 to 2,000 square feet range, comprising 68% of all registrations. District-wise, Medchal-Malkajgiri led property registrations with 42% of the market, up from 45% in September 2023. Rangareddy and Hyderabad districts accounted for 39% and 19% of the total registrations, respectively.
Despite these encouraging trends, the September decline has raised concerns among developers and buyers. The question remains whether this is a temporary dip or the beginning of a more significant trend. Developers are cautious about launching new projects, and buyers are holding their breath, waiting to see if the market will stabilize or continue to decline.
Knight Frank's data provides a mixed picture, highlighting the resilience of the market while also pointing to potential challenges. As the year progresses, it will be crucial to monitor these trends to better understand the future of Hyderabad's real estate market.
Frequently Asked Questions
What recent trends are observed in Hyderabad's real estate market?
Hyderabad's real estate market has shown a 34% year-on-year increase in home sales from January to September 2024. However, there was a 22% decline in September 2024 compared to the same month in 2023, attributed to the Shradh/Pitra Paksha period.
Why is there a concern about a real estate bubble in Hyderabad?
Concerns about a real estate bubble stem from the recent decline in home sales and registrations, especially in September 2024. Developers, builders, and consumers are speculating about the sustainability of the market and the impact of new project launches on inventory levels.
What is the premiumization trend in Hyderabad's real estate market?
The premiumization trend refers to the growing sales of high-end properties priced at Rs. 1 crore and above. This trend increased from 9% to 14% during the first nine months of 2024, indicating a shift in market preferences towards luxury homes.
Which districts in Hyderabad have the highest property registrations?
Medchal-Malkajgiri district leads with 42% of the property registrations, followed by Rangareddy at 39% and Hyderabad district at 19% of the total registrations.
How does the Shradh/Pitra Paksha period affect property sales in Hyderabad?
The Shradh/Pitra Paksha period is considered inauspicious for buying or registering homes according to the Hindu calendar. This cultural observance likely contributed to the sharp decline in home sales and registrations in September 2024.
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