Hyderabad Property Market Ranks Second-Most Expensive in India

By : 360 Realtors

12 September, 2023

As property prices continue to surge across India, Hyderabad has emerged as the second-most expensive market in the country, with a staggering ratio of 31%. This marks a significant increase from the 30% ratio observed in 2022 during the first half of 2023.

Notably, Mumbai maintains its leadership position in the industry, witnessing a 2% increase in ratio compared to 2022. During the same period, the ratio in Mumbai has risen from 53% to 55%. Delhi's National Capital Region (NCR) has also experienced growth, with the ratio increasing from 29% to 30%. Similarly, Bangalore has seen an uptick from 27% to 28%.

However, across all cities in 2023, affordability has been diminishing due to the rising property prices. Currently, Ahmedabad stands as the most affordable housing market among the top eight Indian cities, boasting a ratio of 23%. Pune follows closely as the second-most affordable city, with a ratio of 26%.

The affordability index, which tracks Equated Monthly Installments (EMIs), had improved in the top eight Indian cities from 2010 to 2021, especially after the pandemic when the Reserve Bank of India (RBI) reduced interest rates to their lowest levels in a decade. Nevertheless, to tackle inflation, the RBI has raised the REPO rate significantly by 250 basis points since then, resulting in a 2.5% increase in home prices across cities. Consequently, the EMI burden has risen by 14.4%, placing additional stress on homeowners. Despite these challenges, the demand for properties across the country continues to grow.

Furthermore, there have been noteworthy shifts in the market's underlying components. Properties in the mid-segment, priced between INR 50 lakh and INR 1 crore, have consistently outperformed the overall market. In contrast, there has been a decline in the sale of properties below the INR 50 lakh mark, primarily due to the higher sensitivity of property owners in this segment to interest rate fluctuations. The demand for affordable homes appears to be suppressed as a result. In the premium segment, property sales are on the rise, catching up quickly.