The high price of cement hits the real estate sector

Despite the presence of many regional manufacturers, cement is becoming more and more expensive in Tiruchi

Despite the presence of many regional manufacturers, cement is becoming more and more expensive in Tiruchi

Fluctuating prices of building materials, particularly cement, have prevented real estate players here from stepping up their business, according to industry sources.

“In general, materials like cement and steel have become more expensive. Despite the large number of cement manufacturers in the region, the cost is prohibitive. It is ironic that cement from other states is available at lower cost,” said RS Ravi, Owner of Aditya Constructions and Chairman of Tiruchi Chapter of Confederation of Real Estate Developers Associations of India (CREDAI). The Hindu.

Mr Ravi added that the association, which has 55 property companies in the city, had issued a statement on the impact of rising cement costs to its national body, hoping to find a solution to the problem. .

“Cement is also an important ingredient in auxiliary products such as fly ash bricks, pavers, rainwater harvesting structures, etc. Even ready-mixed concrete units need a constant supply of cement,” Mr. Ravi said.

Rising prices had led to a reconfiguration of construction costs, pushing them up by at least 15% in recent months, Mr Ravi said. “A single brick of fly ash now costs ₹8.20 per unit, compared to only ₹7 before. If you add the cost of other materials like PVC pipes, steel, etc., the construction of a house can be very expensive these days,” he said.

Many industry players felt that public awareness of cheaper options in the cement market is lacking.

“Tamil Nadu Government’s ‘Valimai’ brand of cement, launched in November 2021, is much more economical at ₹330 per bag. The reach of the brand needs to be enhanced,” said I. Napoleon, President of the Tiruchi Chapter of the Builders’ Association of India (BAI).

Apart from cement, the prices of materials like steel, pipes and other essentials had soared even during the pandemic lockdown period. The Russian-Ukrainian war has made the situation worse, he added.

“People’s mindset determines which brand of cement does best in the market,” said BAI-Tiruchi Board Member Jayant Kumar M. Mehta. “We can sell an apartment for a certain price, but the costs that builders incur for labor and building materials are much higher. Only when material prices are normalized can the real estate sector and the economy grow,” he added.

Lately, land prices in the suburb of Tiruchi have increased due to new development projects proposed by the government.

After the announcement of the integrated bus station and the wholesale vegetable market, the value of building land in the suburbs of Panjappur and Olaiyur is said to have increased significantly within a few months.

“High construction costs will slow the expansion of the city unless the government intervenes,” Mehta said. “We need a lot of layouts and major roads to develop. Both private and public bodies can be involved in development. We are looking for properties in the suburbs, but buying them at inflated prices is not safe, in case projects don’t take off as expected.

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