Many Hyderabadis have bought 2nd homes and some even third homes. As the Covid-19 virus caused pandemic spread, the offices allowed work from home. Many of those who were renting decided to move back to their home towns. This has led to excessive availability of rental premises especially for residential premises.
This is leading to a never before seen situation in Hyderabad and especially in the HITEC city areas. It is not only restricted to only HITEC city area but across the entire city in almost all areas. This situation have now continued for over a year. While it looked like things will improve in the last part of 2020, the second wave has made the situation difficult again for property owners.
Some Renters Bought Own Property
Many of the renters have also felt the need to purchase their own property and they have also vacated their rented premises. This has also led to excessive inventory of unoccupied rental premises.
Unoccupied Property Increases Out Of Pocket Expenses
When a premises is not rented out, not only does the land lord lose out on rent. But the landlord has to pay for maintenance charges, water and electricity bills. Not only is there loss of income but also the costs have gone up.
Owners Reduce Their Standards To Get Somebody To Rent
As renters have become scarce, landlords who earlier refused to let out to their premises to bachelors especially in high-end apartments, have now been compelled to rent out property to bachelors. Sometimes, owner is just letting out one bedroom to one party and the others to unrelated parties. Even if they find one renter, the out of pocket expenses get covered for the owner.
Fall In Rental Rates By 30% And More
Not only that the rental rates have also fallen in many areas. Typically, there is 30% fall in rental values. Despite dropping the rental amount, almost every apartment has a advert on the gate showing vacancy.
As property owners struggle in a difficult situation, there are many who have put up their premises for sale. Many had purchased the properties assuming a steady and continuing rent without any interruption. The Covid-19 virus induced pandemic has totally messed up their plans and putting them in much financial distress. ‘
Initially, the apartment owners especially assumed that since it is only work from home, their tenants will continue to rent out their premises. But once the tenants figured out that their work from home will be for a long-period, they started making other plans. Even with schools operating with online teaching, another incentive to continue renting the apartments disappeared. Another thing also on the mind of the renters was the need to be with elderly parents and in the company of near and dear. No doubt, cities are also much likely to spread the corona viruses.
Once a few people started it, their colleagues also probably liked the idea. Very soon, there was a deluge of people leaving the city for their home towns. The lock-down caused much re-think in people’s mind. With many young employees having taken only one dose of vaccine with the next vaccine being almost 3 months away. Some have not even take the vaccine. So this issue will remain for a few more months.