Telangana has suddenly become a superstar of sorts and investors, homebuyers alike are interested to invest in this hot destination. Why this popularity all of a sudden? The state government recently announced a hike in property prices by 25-50%. While the values of residential apartments have been increased by 25%, the agricultural lands and plots are bound to witness an uptick of 50% in their price. This price rise is expected to bridge the gap between the open market rates and the registration rates fixed by the government. So, is this good news or bad news? This article would explore the details.
The Current Status – In Numbers
The decision to hike the property rates would significantly impact the real estate industry, especially in and around Hyderabad’s vicinity. For instance, the market prices at Shankarpally have been increased by 40% to INR 2,800 per square yard. In micro-markets such as the Kondapur-Gachibowli region, the prices have been hiked from INR 14,000 per square yard to INR 26,000 square yards. Similarly, in Kokapet, the current price is now fixed at INR 14,400 per square yard, previously which was at INR 10,000 per square yard. The highest price was witnessed at Puppalguda at 50% with new market prices fixed at INR 21,000 per square yard.
In comparison to the last year, housing prices in Hyderabad have spiked by 7%. After average-price appreciation, Hyderabad is now currently the second-most expensive housing market after Mumbai Metropolitan Region (MMR). There’s no surprise that the reason behind the property price rise is the pandemic. It is the primary reason why the cost of construction materials has gone up and has impeded the supply chain process.
The Future Scenario
As of now, the trend seems to be picking up in the real estate fraternity and most real estate developers are making hay while the sun is shining. The officials of Telangana have further divided these properties into three crucial segments to decide the extent of the hike. All property price revisions have been implemented based on this model.
The real estate developers in Telangana are still anxious about this decision as it arrived after the recent rise in stamp duty charges. Recently, the stamp duty was increased from 6% to 7.5%. The state is now expecting to double its revenue from registrations of properties.
This might be a welcome move to the real estate developers, but the homebuyers need to bear the brunt of the price rise whatsoever. While the recent festive season had a visible impact on demand as well as supply, Hyderabad has been witnessing a rather moderate yet positive change in the Hyderabad housing market. Hoping that the economy settles in, and provides buyers with higher job security, the recovery process in the real estate sector might gather more momentum in the coming year.
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