Srikanth Godavarthi Hyderabad

A few years ago, being a crorepati was a big deal. It still is for many. But Hyderabad’s real estate prices have changed the meaning of that milestone, at least when it comes to buying a home.

Today, Rs 1 crore is no longer necessarily a luxury-home budget. In many established parts of the city, it is increasingly the money a middle-class buyer may need for a decent new apartment. Even with Rs 1 crore in hand, buyers may still have to make choices on size, location and amenities.

For those with a lower budget, the Rs 50-75 lakh segment has not disappeared. But it has increasingly moved towards emerging and peripheral areas.

“In Hyderabad, a new 2-BHK in the affordable to mid segment would typically start at around Rs 70-75 lakh in emerging locations, while in established and well-connected micro-markets, prices are increasingly closer to Rs 80 lakh to Rs 1 crore and above,” said N Jaideep Reddy, President, Credai Hyderabad. “The Rs 1 crore to Rs 1.5 crore range has become increasingly common, particularly in the western corridor, where land values and development costs are significantly higher.”

Where Rs 50-75 lakh still works

Reddy said buyers can still find new homes in this range in Bachupally, Kompally, Kapra, Medchal, Pocharam, Ghatkesar, Vijayawada Road near Ramoji Film City, Shamshabad, Kothur, Patancheru and Mutangi, depending on the project and its stage of development. “In these markets, buyers can still find 2-BHK apartments, generally in the range of around 1,000-1,300 sq ft, although sizes vary considerably,” he said. But the same budget buys less as the location gets closer to established employment centres. “In some projects, particularly closer to established employment corridors, the same budget may translate into a more compact 2-BHK or smaller configurations,” Jaideep Reddy said. “The important point is that affordability at this price point increasingly depends on the buyer being flexible about location and distance from the established city centres.”

Smaller homes, not cheaper homes

Rising costs are also changing the size and design of homes in the lower-ticket segment. “There has been a gradual shift towards more efficient and compact home configurations in the sub-Rs 75 lakh segment, largely reflecting the increase in land and construction costs,” Jaideep Reddy said. “Developers are focusing on optimising layouts to provide functional homes within a particular price range rather than simply reducing specifications.” There is no single figure for how much average home sizes have fallen over the past five years, he said, as the change varies across locations and projects. “However, the broader trend has been towards better space utilisation and more efficient layouts, with developers trying to balance apartment size, functionality and affordability.”

A Rs 75-lakh home can become an Rs 85-lakh-plus purchase

The advertised price is only the starting point. Registration and government charges, parking where separately charged, maintenance or corpus deposits, amenity-related charges and interiors can push up the final bill. “The advertised price should not be treated as the final cost of ownership,” Jaideep Reddy said. “For a property advertised at Rs 75 lakh, the final outlay can certainly cross Rs 80-85 lakh depending on the project, specifications, applicable taxes and the buyer's interior requirements.” Once interiors are added, the actual amount can rise further, particularly for wardrobes, modular kitchens, lighting, electrical work and other basic fittings.

“Buyers should evaluate the total cost of acquisition rather than only the base apartment price,” Reddy said.

Why Rs 1 crore is becoming common

The rise in land and construction costs is making low-ticket homes harder to deliver in established locations. “Land values have risen more sharply in established and high demand corridors such as Gachibowli, Financial District, Kokapet and Nanakramguda. Construction costs have also increased due to higher material, labour, logistics and other development related expenses,” Reddy said. “There is no uniform proportion of land and construction costs that applies across Hyderabad. In established areas, land accounts for a larger component of the overall project cost, while in emerging locations, construction and development costs form a relatively larger share.”

Reddy said the shift towards higher-ticket homes is not simply developers chasing bigger margins. “There has been a visible shift in new residential supply towards higher ticket-size homes. However, this is not simply because developers are pursuing higher margins,” he said. The Rs 50-75 lakh segment is increasingly being served through emerging locations, smaller configurations and projects by regional and local developers.

The EMI is only part of affordability

For a middle-class family working in HITEC City, Gachibowli or the Financial District, staying within Rs 50-75 lakh may mean moving farther away. Reddy said buyers may explore Bachupally, Kollur, parts of Tellapur, Kompally, Ghatkesar and Shamshabad, depending on the project and connectivity. But the lower purchase price can come with a higher daily cost. “A lower ticket size may come with a longer daily commute and higher transportation costs,” Reddy said. “The overall affordability of a home should consequently be assessed by considering the EMI alongside the time and recurring cost involved in travelling to work.” There is also no single income threshold for a Rs 75-lakh home.

“Affordability depends on the down payment, loan amount, interest rate, tenure and the buyer's existing financial commitments,” Jaideep Reddy said.

“While incomes have grown, particularly across Hyderabad's technology, services and professional sectors, the pace of growth has varied across households.”

For first-time buyers, he said, “building adequate savings for the down payment and maintaining a manageable EMI” is increasingly important.

What does affordable really mean?

Reddy believes a cheaper home is not automatically an affordable home. “A Rs 60-lakh home may be affordable relative to a Rs 1.5-crore home, but that does not automatically mean it is affordable for every middle-class household,” he said. “The true affordability of a home is determined by a combination of its purchase price, apartment size, financing cost, registration and other charges, maintenance and, importantly, the cost and time involved in commuting.” “What has changed is the geography and definition of affordability,” Jaideep Reddy said. “A buyer with a Rs 50-75 lakh budget still has options, but may need to compromise on location, size or amenities.” He said the longer-term answer is to increase housing supply across price points, improve connectivity between residential and employment centres, make land and development more efficient and reduce avoidable costs.

“Affordable housing should ultimately mean affordable ownership without an unsustainable EMI or an unreasonable daily commute,” Reddy said. For Hyderabad’s middle class, that is the new housing reality: Rs 50-75 lakh can still buy a new home, but Rs 1 crore is increasingly becoming the price of buying one without too many compromises.