If the state of the property market is any gauge of the impending prosperity then Hyderabad is staring at skyrocketing economic growth. From a highly affordable city, Hyderabad has transformed into the 2nd costliest real estate destination in India. The robust IT ecosystem and rich talent pool in Telangana attract many companies, making it the fastest-growing state in the country.
Hyderabad property market had the strongest residential segment growth in 2021 and the momentum continued even in the first six months of 2022.
In our continuous study of the emerging trends, which we make public every six months, we capture homebuyers’ preferences with significant insights.
Hyderabad Market Report (Jan-June 2022) offered a deeper understanding of these trends.
Strong workforce migration in the city, the need for secure large homes, steady property prices, and increased stay at home for work — all have contributed to the enhanced homebuyers’ interest.
Let us dive deep into the report to understand the state of the Hyderabad property market.
Changes in Homebuyers’ Preferences
The demand data of the Hyderabad property market has revealed that 3 BHK homes are now predominantly preferred (93% of the overall demand). In places like Banjara Hills, 100% of the demand is for 3 BHK homes. The demand for 2 BHK homes is negligible at 7% of the total demand.
If we look at the budgetary preferences of homebuyers, we see an interesting fact.
82% of the total demand is for homes priced between Rs 1.01 and 1.5 cr.
Are homebuyers favouring apartments with larger areas? It surely seems so.
38% of all homebuyers now prefer homes between 1200-1500 sq. ft. while 33% of them prefer 1000-1200 sq. ft. apartments. Also, a significant 16% of all demand is for 1500-2000 homes. In total, 87% of the demand is for these 3 categories of homes.
Among the top 10 location preferences by homebuyers, Konadapur has emerged as the most preferred zone with 36% of the demand, followed by Banjara Hills with 15%. 11% of the total demand is for homes at Gachibowli and 10% of all homebuyers prefer Jubilee Hills. Pocharam followed suit with 9% of the overall demand.
Budget Range-wise Top Contributing Pockets
If you are with me so far, let’s now look at the top contributing pockets according to home prices. This data will divulge the location preferences of homebuyers in different price ranges.
In the case of apartments priced between Rs 61-70 lakh range, Bahadurpalli dominates the demand with 45% share, whereas Gundlapochampalli (30% of overall demand) and Kondapur (10% of the overall demand) are other major contributing areas. Together they constitute 85% of the total demand in that budget range.
Now, let’s look at the Rs 71-80 lakh budget range and shares of different locations in it. Here, Jubilee Hills dominates the demand share with 29%, while Kondapur and Pocharam (each with14% of overall demand). Other locations captured a share of 36% of the overall demand between themselves.
As we will see going forward, Rs 1.01-1.5 cr segment is one of the most preferred segments in a variety of locations. Let’s see the locations which are preferred by homebuyers.
In the Rs 1.01-1.5 cr segment, 4 locations contribute 60% of the overall demand, and the balance 40% is captured by other locations. Banjara Hills (19%), Kondapur (16%), Secundrabad (13%), and Kokapet (12%) are top contributors in this segment.
Location Specific Data
If we examine location-specific data, we will find clear signs of consolidation of demand in terms of budget, BHK, and, flat area preferences.
Let’s first consider data from Kondapur.
89% of the overall demand is in the budget range of Rs 1-1.5 cr. 88% of homebuyers prefer 3 BHK. 39% of all homebuyers prefer 1201-1500 sq. ft. homes, and 31% of homebuyers prefer 1001-1200 sq. ft. homes.
The demand pattern of Banjara hills is highly polarized as far as the budget is concerned.
While 79% of all demand here is for Rs 1-1.5 cr homes, only 17% of home demand is for Rs 1.51-2 cr range.
Area-wise, two major segments’ demand rules over others. 1201-1500 sq. ft. homes are desired by 36% of all homebuyers, and 33% of the demand is for 1001-1200 sq. ft. homes.
Demand polarization is visible here too, as 92% of all demand is for homes priced between Rs 1.01 cr and Rs 1.5 cr. 93% of all homebuyers prefer a 3 BHK home.
39% of all homebuyers want a home between 1201 and 1500 sq. ft. while 31% of the total demand is for 1001-1200 homes.
Here also, 91% of all homebuyers prefer a 3 BHK home, and 80% of all homebuyers want to buy a home between Rs 1.01 cr and Rs 1.5 cr.
As far as area-wise demand is concerned, although 35% and 25% of the total demand are for 1201-1500 and 1001-1200 sq. ft. homes respectively, a very significant 31% of all homebuyers prefer homes between 1501 and 2000 sq. ft.
Virtually no one wants a 2 BHK home here as 97% of all homebuyers want a 3 BHK home.
Distinct budget preference is also apparent here with 89% of all homebuyers want to buy a home priced between Rs 1.01 and Rs 1.5 cr.
Interestingly, a significant 24% of the total demand is for 1501-1800 sq. ft. homes.
What is Changing?
As we said at the beginning of this article, Hyderabad is fast turning into a premium real estate market only behind the Mumbai Metropolitan Region (MMR) market. Of course, we expect that the expansion of the Metro network will open up new areas for development, and homebuyers will find these locations relatively affordable yet well connected.
There is a distinct polarization of demand in different locations as far as budget range and home area are concerned.
3 BHK is the default demand segment now. The demand for 2 BHK homes is approaching zero.
There is considerable optimism about the prospects of Hyderabad, and it is reflected in robust consumer demand.