Hyderabad: Top 6 localities for rental accommodation
With Telugu Desam Party (TDP) winning maximum seats in Hyderabad, real estate is all set to get a shot in the arm. As the party has won the election on the “development” agenda, the real estate fraternity is optimistic about the infrastructural development of the city. With election dust settling and just two weeks left for the official birth of India’s 29th state (2nd June), property market in Hyderabad is also inching a new high. However, as far as the impact on the property values are concerned, it is unlikely that it will be visible immediately.
But nonetheless, this newfound political stability will have a significant impact on the real estate market of the city. Recently, CRISIL also made a statement that after a slowdown for four-year, capital values in Hyderabad will rise at a relatively faster pace. Thus, this could also be the best time for a home buyer to enter the market.
Why Hyderabad?
Out of the major cities in India, Hyderabad is a city where affordability is still a reality. This to a large extent can be attributed to the political instability due to the Telangana issue since the last few years. Further, “after the subprime crisis, most of the cities recovered and got back on the growth track. However, Hyderabad did not bounce back, as a result the property values touched an all-time low. And till date, one can easily find affordable properties in the city and garner healthy rental yield,” says Ravi Varma of Perfect Pincode.
While affordability is a major factor, IT industry coupled with well-developed infrastructure also makes Hyderabad a potential option for investment.
As the days of indecisiveness comes to an end, CommonFloor.com presents you six areas that offer guaranteed rental returns.
Madhapur
Clocking the rental yield of 6.1 per cent, Madhapur tops the list of preferred location for investment in Hyderabad. Being an IT hub, the area receives a robust demand from the techies working in and around the area. This is also validated by the healthy appreciation in the capital values.
As per data with CommonFloor, the capital values have climbed from Rs 4,100 per sq. ft. in Jan-Mar’13 to Rs 4,700 per sq. ft. in the same quarter of 2014, depicting a clear rise of 14 per cent in one year.
Currently, the property values are in the range of Rs 3,900-4,800 per sq. ft. which can effectively fetch you rentals of about Rs 20,000-22,000 per month. Though economic segment has the maximum supply, there is healthy supply of both luxury and ultra-luxury properties in the area.
Chandanagar
With the rental yield of 5.7 per cent, Chandanagar has secured second position in the top six list of the preferred localities for rental accommodation. And investing just about Rs 29 lakh can garner you rental income of Rs 14,000-16,000 per month.
Its proximity to the IT hub of Gachibowli (12km) has helped the area climb the realty ladder, so much so that, capital appreciation in Chandanagar has surpassed Miyapur. “Last year, the property that was available of Rs 2,600 per sq. ft. today is now available for nowhere less than Rs 2,900 per sq. ft., recording a clear rise of about 11 per cent in just a year,” adds Ravi Varma.
Strategically located on the Mumbai Highway between Miyapur and Lingampally, Chanda Nagar also boasts of good connectivity and sound social infrastructure.
Miyapur
With the rental yield of 4.6 per cent, Miyapur, part of Greater Hyderabad Municipal Corporation (GHMC) is at the third spot. A coveted address in the city, its easy accessibility to Hitech City (10km) makes it a key locality for rental accommodation for the IT professionals.
Further, the area has another advantage of upcoming metro station. Currently, the property values are in the range of Rs 3,000-3,400 per sq. ft. and can clock rentals in the range of Rs 14,000-16,000 per month in a gated community.
Being an IT hub, the area will always have a robust housing demand from the mid-segment IT professionals. Thus, investing in Miyapur is a great value for money deal.
Kondapur
With the rental yield of 4.22 per cent, Kondapur has carved out a niche for itself in terms of rental returns. The area has been recording sturdy rise in capital appreciation. The property that was selling at Rs 3,400 per sq. ft. in Jan-Mar’13 is today selling at nowhere less than Rs 3,700 per sq. ft., clearly recording a rise of 8 per cent in just a year.
“With legal-free land parcels, property values are expected to rise in the coming years. Currently, a 1250 sq. ft. apartment is available for Rs 3,100-3,400 per sq. ft., which would command monthly rentals of somewhere about Rs 17,000-18,000,” adds Varma.
CommonFloor data suggests that maximum properties are available in the economic price band, i.e., Rs 40-70 lakh. As per the BHK configuration, 3BHK units are most preferred, closely followed by 2BHK units.
Nizampet
Investing Rs 20 lakh in a 2BHK apartment in Nizampet can effectively fetch you monthly rentals in the range of Rs 8,000-10,000. Shocked? Well, it’s true. With the rental yield of 4.18 per cent, the area evolved as a potential option for investment.
As per data with CommonFloor, capital values have climbed up from Rs 2,300 per sq. ft. in Jan-Mar’13 to Rs 2,600 per sq. ft. in the same quarter of the year 2014, clearly depicting a rise of Rs 13 per cent.
“Proximity to Hitech City (10km) makes it a value for money deal. And the tag of affordability renders the locality good for rental returns,” informs Ravi Varma of Perfect Pincode.
Currently, the capital values in Nizampet fall within the price bracket of Rs 2,000-2,600 per sq. ft. As per data with CommonFloor, the area has the maximum supply (more than 60 per cent) of properties in the affordable range. While 2BHK apartments are most preferred, investing in 3BHK units can also be a good deal.
However, Nizampet has its own set of disadvantages. The area is still under panchayat and due to high density apartments, it is congested as well.
Gachibowli
Clocking the rental yield of 3.8 per cent, Gachibowli, one of the prominent IT hubs of the city is at the sixth position.
Currently, the capital values fall within the price bracket of Rs 4,000-5,000 per sq. ft. and the rental values are in the band of Rs 20,000-22,000 per month.
Being one of the developed areas, Gachibowli does not even disappoint on the liveability front. In addition to smooth connectivity, the area also boasts of well-fabricated network of social and physical infrastructure.
But does these areas have enough supply? Well, most of the localities have several projects in the pipeline. Few active developers include Prestige Group, Vasavi Nirman Developers and Builders,Vajra Srinivasan, Prem Constructions, Aparna Constructions, Ekta Group and Shilpa Construction, to name a few.
Thus, if you have an investment horizon of 3-5 years, this is the right time to enter Hyderabad’s market. Once there is political clarity, prices are expected to appreciate further.
