Hyderabad Residential Marketbeat Q3 2020
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M A R K E T B E AT HYDERABAD Residential Q3 2020 Developers optimistic as launches continue in Q3, 5000+ units expected in 3 -6 months The residential market in Hyderabad showed signs of resilience during the ongoing COVOID-19 pandemic with a steady momentum being NEW UNIT LAUNCHES (Q3 observed in terms of new launches. Construction activity has also resumed across most projects as developers remained optimistic with growing 2,991 2020) enquiries and sales. Nearly 3,000 units were launched in Q3 (almost on par with last quarter) by major developers such as SMR Holdings, Lansum properties, APR Group, Pranava Group etc. across prominent residential catchments of Kondapur, Narsingi, Bandlaguda, Somajiguda, SHARE OF HIGH-END Patancheru, Bachupally, Vanasthalipuram. The high-end segment accounted for 80% of the new units launched followed by the mid-segment at 80% SEGMENT (Q3 2020) 15%. Nearly 2/3rd of all units launched were 3BHKs with an average unit size of about 2000 sf, up by 9% q-o-q, an early sign suggesting a shift in buyer preferences for bigger unit which offered options for additional work spaces as firms continued to drive the Work from Home trend. Additionally, developers are continuing with their groundwork related to approval processes to launch nearly 5,000+ units over the next 3-6 RENTALS DROP ACROSS months. 3-5% MAJOR CATCHMENTS Stable prices in Q3, growth in sales and enquiries Residential prices have largely remained stable during Q3 across most of the residential catchments. Developers were focused on reducing their unsold inventory through various concessions for homebuyers, which translates into lower ticket sizes and was a boost to homebuying demand. MARKET INDICATORS OVERALL Some developers with projects in the final leg of completion have indicated that their project enquiries were almost equivalent to pre-COVID Q3 2020 levels, with a 30-40% share attributable to the pent-up demand from Q2. In certain cases, where quoted prices have increased (largely in the Western quadrant), developers were willing to negotiate and offered attractive payment schemes to convert enquiries into sales. Completed as Y-O-Y 12-Months well as close to completion construction projects (within the next 6-12 months) witnessed maximum interest from buyers across the city. Given Change Forecast the positive momentum and early signs that the market is picking up, developers are likely to continue incentives in the short term (festive season /Q4) to further push sales. New Launches Rental corrections across the city, landlords flexible With the number of vacant properties steadily increasing every month due to the pandemic enforced migration, rentals across all major Units Sold catchments/segments have decreased by 3-5% during the quarter. Rentals in prominent residential localities such as Kondapur, Madhapur, Narsingi, Manikonda, Kukatpally, Miyapur, Lingampally, Nallagandla etc. in the western quadrant have corrected by about 4-5% over the last 3-4 Average Capital months. Besides willing to negotiate on the rents, landlords were also flexible with security deposit and shorter lease terms. Rental corrections of Values (INR/sf) up to 3-5% were also witnessed in the eastern and southern quadrants. Further correction in rentals (mostly marginal) maybe likely over the next 2-3 months with growing competition among landlords and continued reduction in the tenant base. SIGNIFICANT PROJECTS LAUNCHED IN Q3 2020 BUILDING LOCATION DEVELOPER UNITS LAUNCHED RATE*(INR/SF) Vinay Iconia Phase 3 Gachibowli SMR Builders 653 8,100 One Hyderabad Somajiguda Pranava Group 140 10,500 Crystal Vanasthalipuram APR Group 153 5,750 M A R K E T B E AT HYDERABAD Residential Q3 2020 RENTAL VALUES AS OF Q3 2020 CAPITAL VALUES AS OF Q3 2020 AVERAGE QUOTED QoQ CHANGE YoY SHORT TERM AVERAGE QUOTED QoQ CHANGE YoY SHORT TERM SUBMARKET SUBMARKET RENT (IND/MONTH) (%) (%) OUTLOOK RENT (IND/MONTH) (%) (%) OUTLOOK High-end segment High-end segment Banjara Hills 54,500-1,41,100 -3% -3% Banjara Hills 8,200-12,200 0% 2% Madhapur, Gachibowli 33,200-64,500 -4% -7% Madhapur, Gachibowli 5,600-8,000 0% 2% Kukatpally 19,600-37,600 -3% -5% Kukatpally 0% 3% Himayatnagar 18,800-33,850 -3% -6% 5,000-6,500 Mid segment Mid segment Madhapur, Gachibowli 4,500-5,700 0% 6% Banjara Hills 20,600-30,000 -3% -3% 4,000-5,000 0% 8% Madhapur, Gachibowli 17,000-26,200 -4% -5% Kukatpally Kukatpally 14,100-21,600 -3% -4% Himayatnagar 4,000-4,700 0% 7% Himayatnagar 12,700-17,450 -1% -5% Miyapur 4,200 – 4,500 0% 18% SIGNIFICANT PROJECTS UNDER CONSTRUCTION IN Q3 2020 Rohan Sharma BUILDING LOCATION DEVELOPER ESTD NO. OF UNITS EXPECTED COMPLETION Director, Research Services +91 124 4695555 /[email protected] Luxuria Patancheru Mahidhara Projects 576 Q4 2022 Kapil Kanala Aparna One Shaikpet Aparna constructions 464 Q4 2022 Senior Associate Director, Research Services +91 40 40405555 /[email protected] SIGNIFICANT CONSTRUCTION COMPLETIONS IN Q3 2020 BUILDING LOCATION DEVELOPER ESTD NO. OF UNITS UNIT SIZE Apila Gandipet EIPL 470 1,395-2,665 cushmanwakefield.com Bhooja Madhapur My Home Group 788 2,595-4,070 A CUSHMAN & WAKEFIELD RESEARCH PUBLICATION Cushman & Wakefield (NYSE: CWK) is a leading global real estate services firm that delivers exceptional value for real estate occupiers Data collated from primary and secondary resources. Estimations are subject to change and owners. Cushman & Wakefield is among the largest real estate * Rental and capital values have been depicted only for key submarkets services firms with approximately 53,000 employees in 400 offices and ** Quoted base capital value and does not include other charges such as Preferential Location Charges, External Development Charges, Internal Development 60 countries. In 2019, the firm had revenue of $8.8 billion across core Charges, etc. services of property, facilities and project management, leasing, The above values for high-end segment are for units typically of 1,200-3,000 sf capital markets, valuation and other services. To learn more, visit www.cushmanwakefield.com or follow @CushWake on Twitter. The above values for mid segment are for units typically of 800-1,400 sf ^Affordable housing has been defined as units with a carpet area of 60 sq.mt in metros / 90 sq.mt in non-metros and value up to INR 45 lakhs ©2020 Cushman & Wakefield. All rights reserved. The information contained within this report is gathered from multiple sources believed to be reliable. The information may contain errors or omissions and is presented without any warranty or representations as to its accuracy..