DELHI: Hyderabad saw 4 per cent drop in housing sales in 2013 to 16,500 units but volumes are expected to pick up from year-end on hopes that uncertainties will fade away with the decision to form Telangana, said property consultant Knight Frank.
"The Hyderabad residential market has remained stagnant in 2013, with a slight drop in absorption. The residential sales volume has dipped by 4 per cent in 2013 compared to 2012. Approximately 16,500 residential units were absorbed in 2013," Knight Frank said in a report.
New launches in Hyderabad have also fallen by 15 per cent to 16,200 units in 2013 from 19,000 in 2012.
"Like other residential markets in the country, Hyderabad witnessed a further slowdown in 2013. Factors such as slow economic growth, rising interest rates by banks, high inflation and political instability among other factors have added to the uncertainties," the report said.
Still, Knight Frank said, Hyderabad fared slightly better compared to other IT/ITeS dominated cities of Chennai and Pune with only a 4 per cent drop in sales volume during this time last year. A greater dip in project launches helped the unsold inventory levels to stabilise.
"Considering the recent decision on formation of a separate state Telangana the prevailing uncertainties will fade away. Clarity on this issue is expected to boost the absorption by the end of the year or early 2015," it added.
On housing prices, Knight Frank said that Hyderabad residential market has seen hardly any movement in prices despite steady absorption levels in the past two years.
"With only a 13 per cent increase in weighted average prices since 2009 the Hyderabad market has been the worst performer among the IT/ITeS driven markets. Bengaluru, Pune and Chennai have witnessed a minimum of 38 per cent increase since the year 2009," the consultant said.
Hyderabad is the most affordable residential markets in the country's top seven cities of NCR, Mumbai, Bengaluru, Chennai, Pune and Kolkata, the report said.