The prices of residential properties in Hyderabad have been steadily rising despite a slump in demand. Insiders in the real estate sector claim that top builders have been advised by influential individuals within the state government not to lower prices, in order to maintain the city’s reputation as a favored investment destination. This advice is allegedly driven by the upcoming state Assembly elections and the desire to present Hyderabad as a thriving and prosperous city.
In addition to this, builders were reportedly promised more infrastructure projects after the elections to further stimulate demand. Any price reductions at this point could negatively impact the market, creating a lull in activity.
The government itself has been showcasing the real estate prices in Hyderabad as a measure of Telangana’s progress. The recent auction of government lands in Kokapet, which sold for a record ₹100 crore per acre, was touted as evidence of Hyderabad’s appeal to various industries and the growing presence of IT companies in the city.
However, there is a less optimistic side to this picture. Reports from real estate market agencies indicate that the situation is not as rosy as it seems. Prices of residential properties in Hyderabad have shot up by 30 to 50 percent post-Covid, rendering them unaffordable for middle-class and upper middle-class buyers. Hyderabad was ranked the second-most expensive market in the country in terms of affordability versus income levels, after Mumbai.
Despite this, there has been no drop in prices, as major builders choose to hold onto their inventory rather than reduce costs. In fact, after the Kokapet auction, prices for high-rise residential complexes were even raised by ₹500 to ₹1,000 per sq ft. These increasing prices have pushed mid-level builders out of business, and homeownership has become an unachievable dream for middle-income citizens.
source: claytoncountyregisterdotcom