New projects, a relatively stable political environment, and a successful CII Partnership Summit portend growth in the sector.
The year 2012 has begun on a promising note with new projects being announced, a relatively stable political environment without much sign of a stir for the separate Statehood of Telangana, and a successful CII Partnership Summit, which was witness to the assurance of huge investment proposals. Builders hope these would create good vibes for the sector.
The Hyderabad real estate market continues to consolidate after entering the new year, with prices still at three-year lows. Builders across segments, luxury housing, middle-income and affordable housing, believe that the market sentiment shows that it is still a buyer's market.
The General Manager of Ramky Estates, Mr Patnaik D. R., told Business Line that demand has shot up in most major cities of the State, barring Hyderabad. Visakhapatnam, for instance, has shown a robust growth and prices too have firmed up there. The situation continues to be stable in Hyderabad.
Several developers have announced new projects in the past few weeks, showing a good sentiment spilling onto 2012. PEBL, a venture that is developing a large project with L&T as construction partner, has announced a project close to the IT hub; Mahindra Lifespaces, one of the top real estate developers, announced a new project, and a few others are close to firming up new ventures.
Many of the developers are also looking at the affordable housing segment, where there is relative demand-supply mismatch.
Mr P. V. Ravindra Kumar, Chief Executive Officer of Vasathi Housing Ltd, said that the company is looking at not only expanding their new venture Vasathi Housing project, but also setting up projects in Bangalore and Chennai. There is good business environment in real estate lately. “Any project that is strategically positioned, with right price offering, will be successful,” he said.
The Managing Director and CEO of Mahindra Lifespace Developers Ltd, Ms Anita Arjundas, earlier during the month, announced their entry into Hyderabad, with a one million square-foot, Rs 250-crore housing project. She said “for a corporate entity focussing on the real estate market in several States of the country, we continue to invest in new projects unmindful of the slowdown, factoring the business cycle of ups and downs.”
“In fact, we continue to study the market keenly and are close to finalising plans for affordable housing ventures, where there is demand. This is a promising area, and the company hopes to enter this by next year, beginning with a focus on markets such as Maharashtra,” she said.
During a meet hosted by the Confederation of Real Estate Developers Association of India (CREDAI) here recently, Mr G. Yoganand, Managing Director of Manjeera Constructions, said the real estate market in Hyderabad is on course again, particularly in the core city areas. The shortage of housing units in the core city areas is resulting in increasing demand in peripheral areas, which are well-connected.
Mr Yoganand, who is the President of CREDAI, AP, quoted consulting firms Jones Lang Lasalle and Knight Frank and their reports to suggest that the real estate prices will go up during the year.
Mr Prem Kumar, President of Andhra Pradesh Real Estate Developers Association (APREDA), said the realty market continues to look buoyant from November last. The agitation-related issues have settled down, the Partnership Summit ended on a very good note and the number of enquiries is going up.
The prices are also likely to firm up as input costs have gone up. The GO No 45 continues to be a matter of concern, as it has stalled some of the large projects. The GO seeks to provide for housing for weaker sections, as mandated by the Government, through the order. In the current form, builders are opposed to this move, the builders association felt.
The real estate developers have appealed to the State Government, requesting it to rework the order and make it more practical. Any delay in resolving this would hold back some of the projects on the verge of being launched, Mr Prem Kumar said.
Mr Patnaik felt that several projects are close to being announced by not only Ramky Estates, but also some other developers in Hyderabad and other major cities of the state including Visakhapatnam, which has seen good momentum lately, due to the announcement of infrastructure projects coming up.
Mr Prem Kumar, quoting recent property shows and the growing number of enquiries for new projects, says that the end-user is hunting for property once again and this will translate into good numbers.
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