New residential ventures dip in Hyderabad

HYDERABAD: There has been a substantial decline in the residential unit launched in the city last year. As per the latest report by international property consultants, Cushman & Wakefield, new residential unit launches across the top eight cities in India declined by 12 per cent with total launch of only 153,000 units last year.

Hyderabad was the worst-hit in the country as the number of unit launches dropped by 46 per cent as developers reconciled to the changing market dynamics post-bifurcation of the state.

Around 5,000 units were launched in Hyderabad in 2014, a 46 per cent decline from the previous year. The dip in the launches was primarily due to the existing unsold inventory in the city.

According to the report, the north-west quadrant of the city witnessed maximum launches in locations such as Nallagandla, Bachupally and Tellapur, with a 45 per cent share in the total units launched in 2014. The report further stated that Madhapur and Gachibowli contributed to about 18 per cent.

Developers tried to give incentives to buyers like free modular kitchen, free car, discounts, among others to clear up piling inventory. However, these schemes did not seem to lure buyers as the overall transaction activity remained subdued.

In 2014, quoted capital values in the high-end segment remained stable across all micro markets. In the mid segment, select micro markets in proximity to the IT-ITeS and financial districts such as Madhapur, Gachibowli, Miyapur and Nizampet witnessed their quoted capital value appreciate by 6-9 per cent due to buoyant end-user demand during the first half of 2014, which remained stable thereafter. Political stability and improving macro-economic conditions may boost housing demand next year, feel realtors.

In addition to that, the industry is expected to see some significant regulatory changes in the coming months with the first full - time budget being presented later in February, which may give a clearer indication on the regulatory and legislative framework for the future,' says Sanjay Dutt, executive managing director, South Asia, Cushman & Wakefield.

Realtors feel that the current trend is unlikely to change until significant steps are taken by the government. 'The first half of 2015 will continue to remain subdued for the residential markets, at least until some more positive measures are introduced to boost the demand. These measures include interest rate cuts by the RBI, incentives in the Union Budget such as enhancements on rebate under Income Tax for home purchases, boost in savings etc,' Dutt added.