Hyderabad: Irrespective of the trends in real estate, the rental housing market has been consistently growing. Yet this phenomenon is not uniform across the city. Hyderabad added significant office space last year, the ripple effect of increase in employment. This also increased demand for rental apartments.
The spike in rentals is huge in Gachibowli followed by Kukatpally and Miyapur. While the average rent in the city surged by four per cent, rent in Gachibowli increased by 5.3 per cent, according to makaan.com. According to experts, West Hyderabad will witness a significant increase in rentals in localities such as Manikonda, Kondapur, Kokapet, Narsingi, Gachibowli and Puppalguda, which are close to the financial district of the city and the IT hub.
Nikhil Bhatia, MD, Capital Markets and Head, Western Region, CBRE India, said, “Rentals have increased across the Hyderabad market with higher appreciation in West Hyderabad than in the East and North markets. Overall, the rents have increased by 15 to 25 per cent in the last three years on account of the increase in capital values.”
The west sees more demand because of the financial district being located there and immigrants always prefer a location near the office. Experts however point out that the eastern part of the city has also seen a significant rise in rents. G. Ram Reddy, Credai President Telangana, said, “In east Hyderabad where there are IT companies, the rents are high. In general also, property prices have significantly increased in east Hyderabad and as a result the rents have increased. Last year, the city added 7mn sq ft of office space. There is a thumb rule that for every 100 sq ft, one employment opportunity is created. These offices will be built in three or four years, resulting in the addition of about seven lakh people. The rents are bound to increase as the demand for rental apartments will surge.”
Additionally, the demand for rental homes is generally higher during the months of March, April and May, and November-December. However, in January and July, there is a continuous demand for rented apartments due to the recruitment period in companies.
Mr Bhatia of Capital Markets said, “Since most school admissions take place during March-April-May, people change their locality keeping in mind the distance from schools. November-December generally sees higher rental demand on account of people changing their address before beginning of the new/next year.”