Hyderabad’s real estate sector faces severe slowdown as sales plummet to half of last year

Hyderabad: The real estate market in Hyderabad has experienced its most severe downturn since the 2020 pandemic, recording the sharpest decrease amongst metropolitan areas, with sales and new launches both falling by half.

According to the latest reports from real estate services firms Anarock and PropEquity, residential sales in the city saw a 45% to 50% decline during this period. The number of units sold decreased from 20,835 between Jan and March 2024 to 11,114 during the same period in 2025, indicating a 47% reduction.

This, the reports state, is the highest percentage drop among all urban centres in the country.

With regard to new launches, the city added 10,275 units in the Jan- March 2025 period — a yearly decline of 55% over the same period in 2024 when a total of 22,960 units were launched. “In fact, over 70% of the new supply was in the luxury and ultra-luxury segments, priced at over Rs 1.5 crore,” reported Anarock property consultants.

Developers acknowledge the decline and attribute it to reduced interest among NRIs in real estate investments, primarily due to the ongoing crises in the US. Apart from this, there is also hesitation among local investors and buyers to purchase properties, owing to poor return on investment, say market insiders. Even job uncertainties in the IT sector have cast a shadow on real estate, they said.

“NRIs always play a crucial role in driving the growth of real estate, particularly those earning substantial incomes in the US and UK. However, the recent economic uncertainty in America over the past two to three months has made these investors hesitant. They have adopted a wait-and-watch approach, postponing property purchases until the situation stabilises,” said V Rajashekar Reddy, president, CREDAI Hyderabad. The industry body urged the state govt to offer a 2% reduction in registration fees and additional incentives for builders to stimulate the sector.

Reiterating the uncertainty among buyers, N Praveen, president, Telangana Realtors Association said: “Post pandemic, real estate prices escalated sharply, reaching Rs 5,000 per sft on the outskirts. Within city limits, the rates have surged to Rs 8,000 and Rs 12,000 per sft. Given the current economic downturn affecting potential buyers, investing in property appears less viable. Additionally, the property market faces oversaturation, with available units exceeding actual demand.”

Global headwinds

Reports indicate that after three years of record supply (2021, 2022, 2023), the housing sector is experiencing a correction. Hyderabad, Pune and Thane, which dominated supply amongst Tier 1 cities during 2022 and 2023, have continued their downward trajectory since 2024. These markets collectively registered 28,227 fewer units compared to the previous year’s corresponding period. “Rising housing prices and global headwinds like ongoing geopolitical tensions and a weak global economy have taken their toll on India’s residential market activity. These factors cascaded down into the housing market in Q1 2025,” said Anuj Puri, chairman, Anarock Group.