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After a four-year hiatus, residential real estate prices are set to rise at a relatively faster pace in Hyderabad with the likely resolution of the Telangana issue.

Due to the Telangana agitation, residential capital values in Hyderabad had stagnated since 2009 and driven investors to other cities such as Bengaluru and Chennai, said a CRISIL report on Wednesday.

“In the immediate term, real estate prices are likely to pick up due to buoyed investor sentiment in anticipation of the city’s return to political and economic stability. In the medium term, the resurgence in corporate investments will improve demand for commercial office space and, in turn, provide a fillip to job creation, particularly in those sectors where fresh investments were on hold, and boost residential real estate demand and prices,” it said

CRISIL Research had earlier envisaged that Hyderabad residential capital values will grow by 6-7 per cent annually in 2013 and 2014. “In the wake of the resolution of the Telangana issue, we now expect the growth in prices to be faster than our previous estimates and the gap in residential capital values vis-a-vis cities like Pune, Bengaluru and Chennai to narrow. However, commercial lease rentals will continue to see only a marginal annual increase in 2013 and 2014 mainly due to a huge oversupply situation,” it said.

Via : TOI