Indore: Labourers leave realtors in troubled waters

File photoINDORE: Mass migration of labourers to their native villages is seen creating a vacuum in construction impacting real estate work post Corona induced lockdown, claimed builders and developers.

A likely labour shortage and a jump in raw material prices are seen adding to the cost of construction post lockdown by over 10 per cent, said industry players.

Naveen Kumar Mehta, President, Confederation of Real Estate Developers Association (CREDAI), Indore said, “Scarcity of labour has already started pinching besides cost of materials such as cement and steel have also gone up. Cost of project is seen going up by almost 10-20 per cent.”

The increase in cost of construction is expected to affect almost all segments from affordable to high-end property with some builders expecting property over Rs 60 lakh to get worst hit as demand for affordable and middle range property will emerge post lockdown, they said.

Developers said they will have to shell out more on labourers due to shortage of workforce and constraints.

CREDAI Indore chairman Liladhar Maheswari said, “Smooth availability of steel and cement is another major challenge faced by the sector and this is seen increasing cost of project. We have also demanded the government to keep a control on sudden jump in prices of cement and steel.”

Builders said amid a slump in demand in past months, profit margins have already squeezed sharply and further absorption of an increased cost of project will be difficult.

Anticipating increase in demand for residences post lockdown due to reverse migration of people from Metros and realizing the need of safe house after pandemic, CREDAI has urged government to reduce home loans to 5 per cent for at least 5 years to woo home buyers.

Vipul Agrawal, property consultant said, “People have now understood the importance of home and now it’s on their priority list to buy a home at least for those who don’t have their own house. Home loan interests are all time low now around 7 per cent.”

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