Downturn in real estate in Hyderabad and Vizag

Hyderabad is one of the largest cities in India. The city has experienced significant growth recently. It also outpaces other cities in terms of real estate sales for many years. The once-thriving real estate industry in the city is now witnessing a marked slump, generating concerns among developers, investors, and homeowners.

After years of strong growth fueled by infrastructure construction, IT sector expansion, and increased demand for premium homes, the market looks to be cooling, with sales and transaction volumes falling dramatically in recent months.

According to industry analysts, residential property registrations in Hyderabad fell by almost 10% in February 2025 compared to the same time last year. Data from local real estate consultancies show that only 5,200 homes were registered this month, down from 5,800 in February 2024, with transaction prices falling by roughly 15% to Rs. 3,200 crore.

HYDRAA effect

Several things contribute to the delay. The Hyderabad Disaster Response and Asset Protection Agency (HYDRAA), which was founded in mid-2024, has implemented stronger restrictions to prevent illegal encroachments and maintain compliance, prompting increased scrutiny from buyers.

This has slowed certain projects and lowered investor confidence. Despite the collapse, some analysts are optimistic about the rebound.

TDP government and the Vizag downturn

Andhra Pradesh’s new government has promised to lead the state into a brighter future and make it a more developed state overall. Though Chief Minister Chandrababu Naidu’s priority is to establish a true capital city in Amaravathi, he has stated unequivocally that Vishakapatnam, better known as Vizag, will remain the city’s financial hub.

Chandrababu Naidu maintained that the development of Vizag is his top focus. However, the market’s mood is currently cautious.

Developers are delaying new product debuts, while investors are avoiding risky acquisitions. Sales and projects in Vizag are experiencing a significant decline. The real estate market in Andhra Pradesh, particularly in Vizag, has been experiencing a collapse.

Stakeholders in Telangana and Andhra Pradesh are assessing whether policy changes or renewed buyer interest can reverse the unanticipated downturn.