Second sale of homes picks up in Hyderabad

HYDERABAD: Inspite of the grim situation in the real estate sector in the city, second-hand homes in central Hyderabad are very much in demand and people are selling their homes, apartments for little or no depreciation, according to realtors.

Several builders and developers were of the opinion that people were not willing to part with their homes, apartments in areas such as Jubilee Hills, Banjara Hills, Somajiguda, Himayathnagar, Begumpet, among others, until their price is met.

'I have not come across a single person selling their house or apartment at a loss. In the current market, even the buyers were not expecting to purchase anything at a depreciated rate. If somebody is selling at a lower cost, buyers often suspect that something may be fishy and if the project has been completed or not, etc,' said Dinesh Kumar, senior vice president, 99acres.com.

'There are a lot of people who are willing to sell at the same cost at which they have purchased. Maybe if someone had purchased an apartments five years ago, they will be willing to take `15,000 to 20,000 hit but the depreciation is very marginal,' Kumar explained.

Realtors feel that the rate of depreciation, if any, would be at around five to eight percent in second hand homes in central areas of the city. In some cases, the rates might differ from apartment to apartment in the same area.

'There are many contributing factors which determine the selling price of any apartment. For example, apartments which has all facilities, including swimming pool and continuous water supply,etc will be of much greater value than those which may have issues like power and water supply.

Even though they are in the same area, there will be a stark difference in the prices,' observed Sumit Sen, director and manager of sales, Prajay engineers.

On an average, a first hand two-bedroom apartment in central part of the city would cost around `40 to 45 lakh. According to realtors, old apartments in these areas are not being sold less than `35 lakh, unless there are several issues.

However, some realtors opine that there is no question of depreciation for relatively new second-hand apartments, which in fact see a appreciation. 'Because the value of the land increases, apartment value also sees an appreciation.

After purchasing an apartment, the appreciation value will keep increasing with every passing year and there can never be depreciation. For example, if you're purchasing for `3000 per sq.ft, after ten years, the value will increase to around `6,000 per sq.ft or higher. So there can never be a depreciation for any of the properties,' opined G Ram Reddy, chairman and managing director, Ram Ark Builders.