Hyd housing prices up 6.9% in Q1 FY24

Hyderabad Housing prices in Hyderabad increased 6.9 per cent in April-June quarter (Q1) of FY 2023-24, according to National Housing Bank (NHB). In a Housing Price Index published by NHB, the regulator for housing finance companies said the home loan rates are still lower than the pre pandemic rates leading to a healthy affordability overall.

The NHB index in Hyderabad is showing an increasing trend on Quarter-on-Quarter (q-o-q) basis since June 2018. The index recorded 0.9 per cent q-o-q rise at 176 points in Q1 FY24 from 175 points in Q4 FY23. It was at 122 points in June 2019 before the pre-Covid period. During the past four years, the city has witnessed gradual growth in the housing prices.

Observing similar trends in the Hyderabad housing market, India’s proptech platform NoBroker’s recent report reveals that the demand for both new and resale residential properties has surged up during the post-pandemic period. As per their data, the average price of residential units in the city grew 24 per cent to Rs 6,145 per sq ft this year from Rs 4,942 in 2019.

Kukatpally, Nizampet, Kondapur, Miyapur and Gachibowli were the most sought after localities for buying homes in Hyderabad. During Q1 FY24, there was 13 per cent increase in the demand for primary or new houses while it was 18 per cent for the resale properties. Due to the unavailability of primary residential units, resale houses have become a popular option among homebuyers in the city.

“The ready-to-move-in homes are the most desirable option by the majority of home seekers. But the stock has declined post-Covid as construction activity came to a grinding halt during the pandemic and the supply has not kept pace with demand. Resale properties in established neighbourhoods with well-developed amenities were preferred by the buyers,” said Saurabh Garg, Cofounder & CBO of NoBroker.

He further said, “Most of the buyers also preferred spacious residential units during the post-pandemic period. Hybrid work culture and being habituated to living in larger spaces led to 32 per cent growth in the demand for 3BHK flats in this city. Though the home loan interest rates have increased, many buyers choose to pay an average monthly EMI of Rs 17,000 over average monthly rent of Rs 15,000.”

The surge in rental prices attracted the individual home buyers as well as property investors to purchase the residential properties in the city. As the landlords have hiked the rents by over 20 per cent during the recent past, nearly 63 per cent of the tenants think it is wiser to buy homes. Also, they believe the property prices will shoot up in future, Saurabh informed.

Due to the scarcity of properties within gated societies and high rentals, several tenants in Hyderabad have settled for standalone buildings. These are often more affordable and provide greater space than apartments within gated communities. Based on the study of NoBroker, about 61 per cent of the residents are looking for a better/bigger accommodation.

The survey says that the real estate bull-run will continue in Hyderabad as more people are looking to invest in this sector. The participants from the city have expressed a keen interest to invest in properties, driven by the expectation that property prices will surge 78 per cent in the future. They are confident that the city real estate market will generate higher returns.