Vijayawada: Surge in Inquiries for Rental & Sale Property post Q1 2014

With Vijayawada being declared the new capital of Andhra Pradesh, the residential market in the city is set to undergo a sea-change in future. However, even prior to this there were positive feelers regarding the prospects of the realty market in the city. This was due to speculations being rife regarding Vijayawada getting the nod following the bifurcation of the State in June. This fact was reinforced by the proportion of inquiries for Rrental and Sale (primarily Apartments) property through CommonFloor, especially after Q2 2014.

Figure 1 shows the change in the proportion of inquiries for Sale and Rental property in Vijayawada for the period between Q1 2014 and Q3 2014, compared to Q4 2013. The proportion of inquiries in Q4 2013 is taken as the ‘base’. The proportion of inquiries in the later quarters is analysed with respect to the ‘base’ values.

Analysis of trend

Based on the comparative analysis of the number of inquiries for Rental and Sale property in Vijayawada, it can be seen that there is an increase in the number of inquiries for both Sale and Rental property, post Q1 2014 (as seen in Figure 1). While the increase was gradual for Sale property from Q1 2014 to Q3 2014, it was particularly steep for rental inquiries, particularly post Q2 2014. With speculations circulating from the beginning of 2014 regarding Vijayawada being declared the new capital, interest was evinced from investors interested in buying residential property in the city. This explains the steady increase in the number of inquiries for Sale property from Q1 2014. However, the surge in the number of inquiries for Rental property in Vijayawada started in Q2 2014, following the actual bifurcation of the State. Expecting Rental prices to surge post the capital declaration, the number of inquiries exponentially increased thereafter.

Figure 2 shows the proportion of inquiries for Rental and Sale property in Vijayawada between Q4 2013 and Q3 2014. It can be seen that the proportion of inquiries for Rental property after a dip between Q4 2013 and Q2 2014 saw a tremendous increase in Q3 2014. The increase in the proportion of inquiries in Q3 2014 was about 525 per cent compared to the previous quarter. Besides, it can also be seen that the number of Sale property inquiries increased steadily from Q4 2013 to Q2 2014.

Analysis of trend

Analysing this trend, we can arrive at some substantial conclusions. The increase in the number of inquiries for Sale property in Q1 and Q2 2014 can be attributed to more buyers evincing interest in investing in residential property in the city. This is in anticipation of Vijayawada being declared the capital of the State. The increase in the number of Rental inquiries in Q3 2014 can be attributed to larger number of people seeking Rental property across the city in anticipation of rental prices increasing following the capital decision.