Hyderabad’s real estate market continues to be one of the most dynamic and rapidly growing sectors in India, thanks to a combination of robust infrastructure development, a booming IT sector, and favorable government policies. As we move into 2024, new regulations and government initiatives are playing a significant role in shaping the landscape of real estate in Hyderabad. These policies are affecting property developers, buyers, and investors, offering both opportunities and challenges.
In this blog, we will explore the most impactful government policies and their implications for Hyderabad’s real estate market in 2024, including updates in regulations, taxation, infrastructure projects, and investment incentives.
1. Real Estate Regulatory Authority (RERA) Updates in 2024
RERA continues to be one of the most crucial regulations governing the real estate sector, aimed at bringing transparency, accountability, and efficiency. In 2024, there have been several updates to RERA in Telangana that are worth noting.Key Updates:
- Digitalization of Records: RERA in Telangana has introduced more stringent digital compliance, requiring all project-related documentation to be uploaded and updated in real-time on the RERA portal. This enhances transparency for buyers and investors who can now access all project information digitally.
- Stricter Penalties for Delays: Developers who fail to meet their project deadlines are now subjected to stricter financial penalties and legal consequences. This provides added assurance to buyers that their investments are secure and that projects will be delivered on time.
Impact:
These updates are expected to increase buyer confidence, as more transparency and accountability are being enforced. For developers, this means more focus on compliance, project management, and timely completion of projects. Investors can now rely on improved regulatory frameworks to safeguard their investments, making Hyderabad a safer and more attractive market.2. Affordable Housing Schemes and Government Incentives in 2024
The government’s continued push for affordable housing remains a central pillar of its real estate policy. In 2024, the Pradhan Mantri Awas Yojana (PMAY) has extended its support with new guidelines and increased benefits for first-time homebuyers.Key Features:
- Extended Subsidy Schemes: The interest subsidy under the PMAY scheme has been extended for the year 2024, allowing homebuyers to benefit from lower home loan rates, particularly for properties priced under ₹45 lakhs.
- Increased Developer Incentives: Developers building affordable housing are offered additional tax incentives and subsidies for infrastructure development, further boosting the supply of budget-friendly housing in Hyderabad.
Impact:
This push for affordable housing is expected to drive demand in the lower and mid-income segments, particularly in emerging areas around Hyderabad like Shadnagar, Yadagirigutta, and Shamshabad. Homebuyers, especially first-time purchasers, will benefit from the extended interest subsidies, making home ownership more accessible. Developers focusing on affordable housing will find increased demand and more favorable margins due to the incentives.3. Stamp Duty Reforms and Reductions
In 2024, Telangana has introduced further reductions in stamp duty rates to stimulate the real estate market, following its earlier success in driving property registrations through similar cuts.Revised Stamp Duty Rates:
- Reduced from 7.5% to 5.5% for certain property transactions, with additional discounts for women homebuyers and senior citizens.
Impact:
Lowering stamp duty directly benefits buyers by reducing the upfront costs associated with property transactions. This move is particularly beneficial for the residential sector, where reduced transaction costs can make a significant difference in affordability. It is expected to encourage more first-time buyers to enter the market and make Hyderabad’s real estate more competitive, especially in comparison to other metropolitan cities.4. Metro Expansion and Infrastructure Development in 2024
Infrastructure development remains a major driver of real estate growth in Hyderabad. The Telangana government has prioritized expanding the city’s connectivity through the Hyderabad Metro, road expansions, and the development of smart city initiatives.Key Projects in 2024:
- Metro Expansion: The Hyderabad Metro Rail’s expansion into key peripheral areas such as Airport Corridor, Raidurg, and BHEL has not only improved connectivity but also raised the value of properties in these locations.
- ORR Expansion: The Outer Ring Road (ORR) project continues to boost connectivity between the city’s outskirts and the central business districts, making areas like Patancheru, Ghatkesar, and Medchal prime targets for real estate development.
Impact:
Infrastructure development increases the appeal of new residential and commercial properties in the suburbs of Hyderabad. Improved connectivity through the Metro and road expansions ensures faster commutes, making these areas attractive for both homebuyers and investors. Properties along these infrastructure corridors have seen a steady rise in value, positioning them as smart investment choices for 2024 and beyond.5. TS-iPASS and Its Effect on Commercial Real Estate
The Telangana State Industrial Project Approval and Self-Certification System (TS-iPASS) continues to facilitate quick and transparent approvals for industrial and commercial real estate projects. In 2024, this system is expected to further ease the process for companies and developers looking to set up operations in Hyderabad.Key Updates:
- Faster Approvals: Companies and developers now receive approvals within 15 days, cutting down on bureaucratic delays.
- Incentives for IT Parks and Startups: Special tax benefits and incentives are being offered to developers focusing on IT and startup ecosystems, encouraging the creation of more commercial spaces, co-working environments, and IT parks.
Impact:
TS-iPASS is expected to continue attracting large-scale investments from IT and multinational corporations. Areas like Gachibowli, Hitec City, and Financial District will continue to see rapid growth in commercial real estate, with an increasing demand for office spaces and residential developments catering to professionals working in these sectors. Investors looking for high returns on commercial real estate will find this policy especially favorable.6. GST Changes and Their Impact
The Goods and Services Tax (GST) continues to impact the real estate market. In 2024, several adjustments have been made to simplify the tax structure for real estate transactions, particularly in the case of under-construction properties.Key Changes:
- Simplified GST Structure: The GST rate for under-construction properties remains at 5%, while affordable housing attracts a GST of 1%.
- Input Tax Credit: Developers working on large residential and commercial projects can now avail of an increased input tax credit, reducing their overall costs and improving profitability.
Impact:
The simplification of the GST structure has encouraged more buyers to invest in under-construction properties, as the overall tax burden is lower. For developers, the availability of a higher input tax credit reduces the cost of construction, allowing them to offer more competitive prices without compromising on quality. The real estate market in Hyderabad is expected to benefit from this clarity and reduced tax impact, especially in the affordable and mid-range housing segments.Conclusion
As we enter 2024, the combination of favorable government policies, regulatory updates, and infrastructure development continues to make Hyderabad’s real estate market one of the most promising in India. Policies like RERA, stamp duty reductions, affordable housing incentives, and infrastructure expansion are driving increased demand while ensuring greater transparency and accountability in the sector. For buyers, these policies present an excellent opportunity to invest in a growing market, while developers and investors can benefit from the government’s focus on supporting real estate growth through incentives and streamlined approvals. At RP Estates, we are committed to helping you take advantage of these opportunities. Whether you are looking to invest in open plots, residential properties, or commercial spaces, our team is here to guide you through the process and help you make the best investment decisions in Hyderabad’s thriving real estate market.