Hyderabad’s real-estate market has been one of the strongest markets in India’s realty sector according to the Economic Survey – 2021-22 tabled by Finance Minister Nirmala Sitharaman in the Parliament on 31st January 2022. The effects of global level Covid-19 pandemic and the 2 waves of the virus in India meant that there was a countrywide decrease in the realty sector over the last 2 years but the economic survey data shows Hyderabad was amongst the few big cities that recovered well and did not showcase the downwards trend in the realty sector witnessed across the rest of India.
Post the first wave of the pandemic in India during the months of April – June 2020, Hyderabad’s real-estate market witnessed a 37.6% decline of housing transactions. Now, during the second wave of the Covid-19 pandemic, Hyderabad’s realty sector housing transactions increased by 37.9% in the period of April – June 2021. The housing price index in Hyderabad recorded an upswing of 21% in April – June 2021 while the increase in housing price index for the same period in 2020 was 12.5%.
The only 2 cities that performed better than Hyderabad’s realty sector in the above aspects were Ahmedabad & Gandhinagar. The data in the economic survey 2021-22 is relative to the data for the same periods in years 2020 & pre-COVID year 2019. All the rest of the realty markets of large metropolitan cities – Delhi NCR, Mumbai Metropolitan Region, Bengaluru, Chennai, Kolkata & Pune did not display as strong a recovery as Hyderabad did but displayed signs of returning to pre-Covid-19 market levels.
There was no decline in prices in the real-estate sector due to the shock of the Covid-19 pandemic although there was a significant decline in the number of transactions across the country. The decline in housing transactions during the second wave was marginal compared to the decline during the first wave of the pandemic and the second wave saw an increase in number of transactions in cities like Mumbai, Thane, Pune, Noida, Hyderabad, and Bengaluru relative to the pre-pandemic levels.
The impact of the housing sector on other industries is quite severe as a change in momentum in the real-estate sector results in a cascading impact of industries that manufacture steel, cement, iron and other raw materials required for construction. The real-estate sector & construction industry is one of the largest employers in the unorganised sector in India and the situation of the real-estate market directly impacts employment opportunities for the unorganised sector. The statistical document notes an uptick in the construction sector. “This has allowed the consumption and production of steel and cement consumption to revert to pre-COVID levels. Statistics provided by the Reserve Bank of India and leading real estate companies’ show significant revival in the Indian residential real market in 2021 in terms of growth in sales, prices and new launches,” notes the Economic Survey 2021-22.