Sentiment turns positive in Hyderabad

The real estate scene in Hyderabad and areas around the twin cities is showing a distinct trend with the affordable segment gaining momentum and more developers looking to address this space as buyers abound.

Sentiment improves

However, an interaction with a cross-section of developers, at a recent meeting hosted by information services provider Dun & Bradstreet, reveals that this segment is also witnessing more enquires.

“The overall situation has changed for the better in the last two-three months with each month getting better. The general gloomy sentiment is behind us,” according to Mr S. Pochender, Chief Executive Officer, Lanco Hills, of the Lanco Group.

The festival season is when there is an increase in the number of enquiries. However, the business is still centered around the affordable home segment. In fact, some of the luxury apartment developers are restructuring their projects to address this segment.

In addition, buyer interest has risen with price correction touching nearly 30 per cent. This, coupled with banks lowering interest rates and gradually stepping up loan disbursals, the sentiment is much more upbeat compared to a couple of quarters back, Mr Pochender explained.

The Managing Director of Koncept Ambience, Mr M. P. Agrawall, said that the market had stagnated for nearly a year. After witnessing a fall and prices coming to realistic levels, things have begun to look up in the last couple of months.

“The prices of land have corrected up to 30 per cent, and those of finished products have come to realistic levels. We believe there is not much scope for further reduction. Even buyers realise this and have begun to enter into deals,” he explained.

Supply scene

Referring to the supply situation, Mr Agrawall said that while there is glut in the Rs 50 lakh to Rs 1crore apartment and villa segments, the supply in the affordable segment is inadequate. In the Rs 1 crore and above category too the number of builders and projects are very few, he added.

Mr Agrawall pointed out that the affordable segment needs to be studied closely. It won’t be easy for every developer to address this space. For those having large land banks, they could consider this segment along with developers who are already in this space.

However, if some of the developers who are currently catering to the above Rs 50 lakh segment want to turn to the affordable segment, it would be very tough. Eventually, many players may hastily get into this space, create an oversupply situation and be at the losing end.

Referring to the Rs 1 crore and above segment, Mr Agrawall said that the price correction has been significant in this area too and buyers realise that the correction phase is over. They are getting into buy mode again.

Millennium Homes, hosted by Dun & Bradstreet last week, attracted quite a few developers in the Rs 50 lakh and above category.

A database of about 25,000 people was drawn up and mailers sent to potential buyers to introduce them to some of the new projects that developers are launching.

Among those who participated in the event include L&T, SMR Vinay, Ramky and Dax Properties.

Dax Properties, promoted by a group of non-resident Indians, in partnership with developers in Hyderabad, is setting up a Rs 500 crore Golf Retreat which will have a 18-hole Golf Course, luxury apartments and plots for construction of villas, according to Mr Masood, Managing Director of Dax Properties.

The Mumbai-based Lodha Builders, which is setting up luxury apartments near the IT hub of Hyderabad, claims that of the 120 apartments planned in the first phase, it has managed to get bookings for 108 which are priced at Rs 2.5-3 crore.

Mr Ravi Sharma, Deputy General Manager, Lodha Builders, said that the company brought about some correction in prices for its luxury apartment venture of each unit of Rs 4,700 sq.ft, with one apartment on one floor.

Source: Business Line