Hyderabad Real Estate Market Shifts Toward Luxury: Understanding the Q3 2025 Transformation
Hyderabad's residential real estate changed dramatically during the third quarter of 2025, moving decisively towards premium and luxury housing. This shift didn’t just happen by chance. It mirrors a fundamental recalibration of buyer preferences and developer strategies amid India's rapidly growing tech hub.
The Rise of Premium Properties
The high-end market continued to dominate Hyderabad's new launches, with 63% of quarterly new supply. When including affordable and luxury segments, premium properties controlled the market's narrative. Developers focused on luxury homes priced above Rs 1.5 crore, which made up 38% of all launches in India's top seven cities. This points to a broader industry recognition: wealthy buyers remain strong even when overall volumes drop.
Geographically, these launches had a clear focus. West Hyderabad led, followed by North and North-West zones, with areas like Kompally, Kukatpally, and Kandlakoya in the picture. Together, these regions made up nearly 95% of quarterly launches, proving the market's focus on high-end properties.
Sales Volume Declines, Yet Values Surge
Interestingly, Q3 2025 was marked by a paradox: while transaction counts dropped 9% compared to the previous year's level in India's top seven cities, totalling about 97,100 units, the overall sales value swelled 14% to around Rs 1.52 lakh crore. Hyderabad specifically saw over 8,400 housing units sold, with new launches reaching 8,865 units. This represented an 11.7% quarter-to-quarter drop and 21.7% year-to-year decrease.
This shows a profound structural shift. Demand from affluent and wealthier households heavily pushed up the luxury segment, highlighting sophisticated market dynamics. Fewer transactions occurred, but the individual property prices were much higher.
Price Momentum Accelerates
Price growth told a positive story for sellers and existing homeowners. Average property values went up by 6% year-on-year, especially in prime areas like Banjara Hills and Jubilee Hills. The high-end segment in these areas commanded significant values between Rs 13,150–15,000 per square foot, meaning a robust annual gain of 10%.
Even in secondary luxury markets, gains were solid. Madhapur and Gachibowli captured values of Rs 9,000–12,000 per square foot with steady momentum. Everywhere else, luxury housing prices in Hyderabad jumped by approximately 37% in 2025, adding to gains from previous years.
Developer Strategy Realignment
Developers recalibrated their strategies, adjusting supply in response to demand trends. About 71% of industry insiders expected new projects to stay stable or rise more, focused on high-value ventures while slowing less profitable lower-segment efforts to avoid oversupply.
This cautious approach maintained investor confidence and kept the inventory balanced.
Market Sentiment and Future Outlook
The Knight Frank – NAREDCO Real Estate Sentiment Index mirrored this optimism. The Current Sentiment Score climbed to 59 in Q3 2025 from 56 in the previous quarter, marking its highest level this year. The Future Sentiment Score stayed firm at 61, lingering optimistic.
South Indian cities, especially Hyderabad and Bengaluru, remained the most energetic markets. Hyderabad's housing sentiment grew stronger, reflecting careful demand management and strategic supply actions. These situations led to year-to-year price increases of 13%–19% in NCR, Bengaluru, and Hyderabad, India's top three residential markets.
Beyond Traditional Categories
While apartment projects with smart features stood out in supply, various property types picked up steam. Emerging eastern zones' plotted developments gained attention, revealing interest in land-led investments from elite buyers looking to diversify real estate exposure.
Conclusion: A Market in Transition
Q3 2025 highlighted Hyderabad's real estate market’s pivot towards premium real estate. Favourable economic conditions, stable interest rates, decreasing inflation, and better liquidity, which combined with rising incomes and improved infrastructure, enabled this change. The city took a firm spot among India’s most alluring residential investments, now marked by luxury properties defining market dynamics and value creation.