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Hyderabad’s realty market remains uncertain

Land transactions in Hyderabad’s real estate sector have come down sharply, following the government’s decision to revoke GO 111. All those who competed with each other till yesterday and bought lands are now lamenting about the future of their investments. Those who purchased plots as an investment are unable to sell them. Further, those who gave advances to the builders for purchasing villas are now backtracking. Even buyers who were eager to buy flats in West Hyderabad, have adopted the wait-and-see approach. Thus, the Hyderabad’s realty market is struggling amidst uncertainty after the GO 111 was repealed.

Kokapet is located next to the GO 111 area. The land price in the GO 111 area is around Rs 5 to 6 crore per acre, while in the areas around Kokapet, it is priced around Rs 40 to Rs 50 crore per acre. With the government revoking GO 111 recently, landowners have stopped selling land. They have opted to wait for a while, with a hope to sell lands at a higher rate. But the buyers are hesitating to purchase even in case if anyone is trying to sell for a slightly higher price. They fear that purchasing land for a higher rate would be pointless in case the courts give a negative verdict against the government’s decision to remove the GO 111. They are not ready to wait for much longer period for the prices to increase any further.

* Those who have already bought villas in Mokila and Shankarpalli at a higher rate, are canceling them. The major reason is that for the amount invested in a villa in these areas, one can purchase at least half an acre of land in the GO 111 areas. With this, the builders who are developing the villa projects in these areas are in doldrums.
Meanwhile, people who invested to buy plots in premium apartment projects are caught in a strange situation. Rather than investing Rs 3 to 4 crore in flats in Kokapet, they are wondering what if they travel a little further and buy land in the GO 111 area as they can choose to construct an independent house of their choice. On the other hand, those who purchased flats in UDS and prelaunch sales, are in the worse situation. Given the increased construction material prices, they are doubtful whether the builders complete the construction of these apartments in a timely manner or not. Thus, the Hyderabad’s realty market is caught between the Devil and the Deep Sea, with no way out visible in immediate future.