Hyderabad: A policy designed to compensate landowners and accelerate urban development has stirred fresh turbulence in Telangana’s real estate market. Following the state govt’s decision last month to make the utilisation of transferable development rights (TDR) mandatory for certain high-rise buildings—and to permit their use for setback relaxations—TDR prices have risen sharply, particularly across Greater Hyderabad.Builders, developers, and ordinary property owners are now raising concerns about what they describe as an artificial price surge and possible market manipulation. TDR is a certificate issued to landowners who surrender property for public purposes such as road widening, the Musi rejuvenation project, and other infrastructure initiatives. Instead of direct monetary compensation, affected owners receive development rights that can either be used on another property or sold in the open market.What was intended as a relief mechanism for displaced landowners is now being characterised as a speculative marketplace. Industry sources note that TDRs, which previously traded at around 23% to 25% of their total value, are now being quoted at rates as high as 70%. Large developers purchasing in bulk are reportedly securing rates closer to 56%, according to members of real estate developers’ associations.The scale of the market is considerable. A Jan 2026 report indicated that the Greater Hyderabad Municipal Corporation (GHMC) had issued TDRs to 1,585 individuals, covering approximately 1,070 acres (51.83 lakh square yards). Of this, about 712 acres (34.49 lakh square yards) had been utilised, while roughly 316 acres (15.31 lakh square yards) remained available.More recent data from the state-run TDR bank website shows that 1,967 individuals have now received TDRs. Based on Jan estimates, nearly Rs 9,000 crore worth of TDRs were available.This raises a fundamental question: If such a large volume of TDR is available, why have prices escalated so dramatically?“When such huge quantity is available in the market, going by govt records, why is there a sudden jump in TDR prices? The govt should act against those illegally hoarding TDRs and inflating prices,” said N. Sridhar, a resident of Gopanpally. Sridhar, who hoped to use TDR to construct an additional floor on his property, claims that certificates are difficult for individuals to obtain. When available, brokers are quoting rates of nearly 70% of the value.Under the new GO issued last month, TDR has become compulsory for certain categories of high-rise construction. Buildings between 10 and 20 floors must meet 3% of the required built-up space through TDR, while structures exceeding 20 floors must meet 5%. Developers are required to submit 50% of the TDR at the application stage and the remaining 50% prior to receiving the occupancy certificate. For non-high-rise buildings, TDR may be used to obtain setback relaxations.The govt maintains that the policy is intended to boost TDR utilisation and provide fair compensation to those who have lost land for public works. However, industry insiders allege that a significant portion of TDR has accumulated in the hands of a small group of influential players.“The govt’s intention may be sound, but much of the TDR has ended up with a few powerful individuals, creating a kind of cartel that has engineered scarcity and driven up prices. Within the industry, there are claims that one individual acquired around Rs 600 crore worth of TDR through benami transactions,” said a former office-bearer of a real estate body. He added that curbing black-market practices falls squarely within the govt’s responsibility.There are also allegations of an informal trading network. Some brokers reportedly obtain details of TDR recipients through municipal town planning officials and approach landowners directly.“When we learn that someone has received TDR after losing land to road widening, we approach them and enter into agreements at a fixed price. Once higher rates are secured, the original holder provides a mobile OTP to complete the transfer during building approvals. We earn a commission from the buyer,” said a broker who requested anonymity.He further noted that smaller brokers have been edged out of the market in recent years, as wealthy investors began directly acquiring TDRs from landowners, tightening supply and intensifying price pressures.In principle, TDR is a straightforward concept: additional built-up area granted in exchange for land surrendered for public use. In practice, however, the system in Telangana has evolved into a contentious issue, raising persistent questions about access, pricing, and market control.
