Hyderabad, the capital of Telangana, has emerged as one of India’s prominent IT/ITeS and manufacturing hubs. Over the past decade, the city has generously accommodated the immigrant workforce across the services, pharmaceutical and industrial sectors. The political stability posts the formation of the state of Telangana and the business-friendly approach, such as TS-iPass, have brought Hyderabad on the radar of global companies and investors. The robust growth in the IT sector has set in motion the residential real estate development, which has been continuously evolving, with several operators constantly adding inventory to the segment.
The metropolitan region of Hyderabad, which covers over 7,257 sq km, is currently under the purview of the Hyderabad Metropolitan Development Authority (HMDA). Its population is expected to reach 9.2 million by 2030. While the western zone is leading in commercial and residential development in Hyderabad, the expansion of metro connectivity and road development are underway to unlock the real estate potential in the remaining regions.
In Hyderabad, the plotted development has uniformly developed along the Outer Ring Road and is also growing along the major highways. Currently, the southern zone of Hyderabad witnesses’ maximum traction for the residential land segment along the proposed Pharma City Corridor and international airport. The upcoming metro will enhance the connectivity of this part with the central and western zones. Micro markets such as Kothur, Shadnagar, Maheshawaram have taken the lead in demand for residential land in this zone. Followed by the southern region, western peripheral localities such as Shankarpalli, Mokila, Bachupally have been at the forefront for residential land demand due to proximity to the commercial hubs of West Hyderabad. Apart from south and west, the east has also been garnering interest with the upcoming Hyderabad – Warangal Industrial Corridor and development of IT corridors under Look East Policy (LEAP).
The rising interest in residential plots in Hyderabad in visible in the growth in land prices which have registered a 21 percent increase in prices between 2018 and 2020 – the highest compared to the top-8 cities. The city’s market for residential plots is mainly investment-driven as people are looking for land in open areas apart from apartments in the high-density western suburbs. Developers in Hyderabad have mainly launched stand-alone plotted development projects in the peripheral areas along major road and metro networks, which offer connectivity to the city’s existing commercial and residential areas.
Hyderabad also has the highest average annual share (41 percent) of demand for land in the overall residential sales compared to the top-eight cities. The demand for residential land in the city in first half of 2021 was a noteworthy 65 percent closer to the 2020 levels.
Hyderabad, currently witnessing a growth spurt in the residential real estate sector, is the most dynamic residential land market in the country regarding pricing and return on investment. While the apartments market is end-user driven, residential land market is mainly investor driven. Hence, the potential development of social and physical infrastructure and connectivity to commercial hubs of central and western areas will be crucial for realising the investment potential of plotted development in peripheral areas of the city.
Renuka Kulkarni, a seasoned real estate professional, brings over five years of diverse experience in research, consulting, and architectural design within the urban sector. Her expertise spans public and private projects, showcasing proficiency in real estate research, trend interpretation, and policy analysis. With qualifications in architecture and a master’s degree in Data Science (Business Intelligence & Data Analytics) from IIIT Bengaluru, along with an M. Tech in Urban Development and Management from TERI School of Advanced Studies, New Delhi, Renuka seamlessly blends data analytics with market insights, offering a holistic understanding of the industry in her research pieces.
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