The real estate market in Andhra Pradesh has taken a hit for several reasons.
It was expected that the arrival of Chandrababu Naidu as Chief Minister would result in a boom in the Amaravati region first. Though there was some growth initially, there is now a huge slump as there is no promising activity around it.
It is said that many investors in Amaravati who own acres of land wish to sell them at higher prices and reinvest in Hyderabad's Future City, proposed by Revanth Reddy, the CM of Telangana. However, the higher prices they seek are not materializing.
Amaravati needs significant craze to spark a real estate boom. How Chandrababu plans to generate that craze at this juncture is unknown.
Meanwhile, real estate prices have fallen in Vizag, Kurnool, Kakinada, and Rajahmundry as well. During Jagan’s government, there was some real estate activity in and around Vizag and Kurnool, as those areas were considered part of the capital zone.
Now that Amaravati is declared the sole capital of the state with Chandrababu Naidu's arrival, real estate in Vizag and Kurnool has taken a hit.
Similarly, places like Rajahmundry and Kakinada are also experiencing a downturn. There are no buyers from outside the city, which means prices are not rising due to the lack of demand.
The average prices of flats in Hyderabad, are between Rs 8,000-13,000 per square foot, whereas in the cities of AP, it is still Rs 4,000-6,000, which is considered high by buyers in those regions.
Overall, unless Chandrababu works on improving perceptions, real estate prices in AP are unlikely to rise, and real development may not occur.
