HYDERABAD: Construction activities have become dearer in Hyderabad with costs going up by about 30 per cent this year, owing to steep hike in the prices of cement, steel and other raw materials, apart from labour wages.
According to the Confederation of Real Estate Developers’ Associations of India (CREDAI), construction cost has risen significantly this year as components like labour, raw materials and diesel became costly in the wake of a steep rise in cement and steel prices.
Rajashekhar Reddy, General Secretary of CREDAI Hyderabad, says that the cost of construction currently ranges between Rs 6,000 and Rs 8,000 depending on the area. “It is not possible to ensure a quality project for a lesser price in the current scenario. On the other hand, construction cost here is less when compared to other metropolitan cities,” he adds.
He also says that some real estate operators who are new to the business have been offering attractive schemes and telling buyers that the construction cost would be just Rs 2,000 to Rs 4,000 per sq ft, which is not possible in reality. Last year, the cost of construction was around Rs 5,000 per sq ft, while it was Rs 4,500 for the same area two years back.
“The cost at which these people are selling properties is not sufficient to cover the cost of construction and in such an event the projects will never be successfully completed. Purchasers should play safe and purchase RERA-approved projects to avoid speculative and unsafe purchase,” Rajashekar adds.
According to Telangana Builders Federation (TBF), steel prices have increased by Rs 20,000 per tonne, while cement got costlier by another Rs 100 per bag. As if this was not enough, labour wages too increased by 15 per cent, besides increase in land value. “Nowadays, we are facing a shortage of labourers too, as many of them who went to their native places have settled there. Most labourers we get are from UP, Bihar, Odisha, Chhattisgarh and Rajasthan. We are paying high advances to contractors to bring the labourers,” points out TBF president C Prabhakara Rao.
Figures show steady rise
Rajashekhar Reddy, General Secretary of CREDAI Hyderabad, says that though some real estate operators are trying to attract buyers saying that the construction cost would be just Rs 2,000 to Rs 4,000 per sq ft, it is not possible in reality. Last year, the cost of construction was around Rs 5,000 per sq ft, while it was Rs 4,500 for the same area two years back