Special housing scheme for middle-class needed urgently
King Johnson Koyyada: There is a sudden panic among the developers following Chief Minister K Chandrasekhar Rao’s announcement that GO 111 will be revoked. Those who already commenced projects in West Hyderabad, are getting worried about their future. Following the land auctions in Kokapet Neopolis, land prices skyrocketed in West Hyderabad. Accordingly, several developers have launched new skyscrapers and multi-storey projects, while many others are gearing up for a launch.
In this context, what effect will the sudden availability of 1.32 lakh acres of land have on the existing projects following repeal of GO 111? Will buyers stop buying property and investors stop investing for a while? Will they take the next step only after getting clarity on GO 111? And whether cancellation of GO 111 withstand the scrutiny of courts? All these and more doubts are plaguing developers.
Following the auctions conducted by the State government, land prices have gone up from Rs 20 crore to Rs 45 crore per acre in areas like Kokapet, Narsingi, Financial District, Puppalguda and Nanakramguda. The rates have also increased in areas like Tellapur, Kollur and Velimala. Having bought land at a high rate, many developers have started multi-storey buildings and skyscrapers to cut-down their losses and make them profitable. With this, the supply of flats increased. But unfortunately, except for a couple of projects, the sales in majority of these projects are on the decline.
Many builders fear that if GO 111 is cancelled, buyers will not purchase skyscrapers and villas which are under construction due to increased costs. Currently, buying a flat in places like Kokapet costs around Rs 8,000 to Rs 10,000 per square feet. Well, if you wait a while and lift the triple organism, the prices of places in those areas will go down. If you start apartments at that rate, you will get flats at a lower rate.
Therefore, the number of people who are currently postponing property purchases, is likely to increase. It will take a couple of years for the GO 111 to be revoked and a master plan is drawn up for its implementation. Investors are unlikely to come forward to purchase new properties until then. Rather than investing Rs 40 crore per acre in Kokapet, if land is available for only Rs 10 crore upon travelling a couple of kilometers more, investors will might prefer the latter and wait for some time to reap the benefits.
Till recently, the land owners in West Hyderabad were calling the shots. In a way, they were responsible to cause unnecessary damage to the construction industry. Builders who expressed their interest to build apartments in these lands, were instigated to take up construction of 30-storey or 40-storey structures. With the fear of losing the deal, the builders would agree to these deals which went on uncontrollably. With the availability of thousands of acres of new land, one can safely say that it would be beneficit the real estate sector to a large extent.
As land availability increases, land prices automatically fall. Therefore, in the coming days, the construction of affordable housing is expected to increase to cater to the needs of the middle-class. Due to the scarcity of land and the high prices in Kokapet, the developers are unable to take up normal projects except for skyscrapers. If the government revokes GO 111, people need not worry about the land availability.
Hyderabad city has already become a concrete jungle. The heart of the city lacks greenery, with lot of trees along the major roads were felled to make way for Hyderabad Metro Rail project, construction of flyovers and other infrastructure development projects. The authorities who assured to replace the lost greenary, have conveniently forgot the same. Howeve, the city is still protected by the greenary spread across 1.32 lakh acres of vacant land under GO 111. But after learning about the Chief Minister’s announcement that the city does not require the twin reservoirs which quenched the thirst of the denizens till recently are no longer required, an average Hyderabadi is enraged and expressing their anger on social media.
Environmentalists, civil rights activities and others are gearing up to file cases in the courts, making it clear that revoking GO 111 will not be any easy affair. On the other hand, the government has also decided to deal with the GO 111 in a planned manner. While CREDAI Telangana and TREDA have welcomed the Chief Minister’s decision, it is important that all the construction associations come together and share their concerns over lifting the GO 111.
CM KCR took a bold decision to remove GO 111. As per his wish, this would pave way for making housing affordable for the common man. The skyrocketing land prices, greed of land owners and rising construction materials prices, are making it difficult for the builders to provide low-cost flats at low prices. Though land prices increased rapidly, the salaries of an average employee has not witnessed much hike. Hence, most of them could be easily trapped by the UDS/prelaunch project builders. As thousands of acres will be available for development, the land prices will remain under control and we can offer flats to buyers at economical price. – Indrasenareddy, Secretary General, CREDAI-Telangana
This website uses cookies.