Hyderabad: The demonetisation move dented the city’s residential market in the last quarter as sales plunged by 40 per cent to 3,034 units compared to the same period in the previous year, according to a report by real estate consultant Knight Frank India.
However, new launches of residential projects witnessed growth of 3 per cent while sales dropped by 6 per cent during the second half of 2016 calendar year, compared to H2 2015, the report said.
On the findings, Knight Frank India’s Executive Director – Advisory, Retail and Hospitality, Gulam Zia said Hyderabad’s residential market withered over the last five years after peaking in 2012.
“While the city observed more than 22,700 units in new launches and 19,000 units in sales during 2012, these numbers have fallen by 49 per cent and 21 per cent respectively since then,” Zia said at a press conference here on Wednesday.
“The reduction in new launches and relatively stable sales volume helped in rebalancing the market to a great extent as the unsold inventory level dropped to its lowest level in the last six years. However, demonetisation disrupted the market sentiment and created a major dent on the residential market in Q4 2016 which saw sales plunge by 40 per cent,” he said.
“We believe that 2016 would have been marginally better than 2015 had it not been for the demonetisation move, as the sales numbers for the first nine months were showing positive trend,” he said.
Unsold inventory levels drop to its lowest level in last six years to 28,088 units in H2 2016, the report said.
The West Hyderabad remains the preferred market, largely because buyers have a preference for ready to move in properties closer to the office hubs, with 60 per cent of home sales, it noted.
The second half of 2016 recorded one of the highest transaction volumes at 3.2 mn sq ft, it further said.
The Hyderabad office market witnessed its highest yearly office space transaction in 2016. Nearly 6 mn sq ft of office space was transacted during the year, which was 31 per cent higher than the 4.6 million sq ft mark achieved in 2015.