Rajamahendravaram: Builders look downcast as cement, steel prices rise
- Russia-Ukraine war has further increased the prices of construction materials, which were already increased post Covid-19
- Construction of several buildings is stopped
- A builder says that before Ukraine war steel rate was Rs 75,000 per tonne and now it is Rs 90,000
- CREDAI Rajamahendravaram Honorary Chairman Buddiga Srinivas urges both the Central and State governments to constitute a committee to revive the construction sector, which is in crisis
Rajamahendravaram: Property owners are facing the brunt of escalation of prices of cement, steel, wood and other materials needed for building construction due to several reasons, including the Covid-19 pandemic. And now, the Russia-Ukraine war has resulted in further increase of prices, particularly iron and cement. There is a variation of 100 percent in the rates of steel and iron compared with the last year.
Due to the increase in the price of raw materials, the cost of real estate projects has gone up manifold. Hence, some of the builders are unable to complete the construction, making the buyers a worried lot. All the construction works came to a halt.
Property owners and building contractors criticised that the governments were not taking any steps to curb the prices. They requested the government to pay attention to their problems and help them in realising their dream of own house.
A few builders said that the manufacturers of steel, cement and other construction materials have sharply increased the prices compared to last year. There has also been a hike in the prices of sand, wood, glass, PoP and other construction materials. They said that there was a huge difference in the prices before and after the agreement made with the buyers. "With this, we have to increase the construction rates. Middleclass people are the worst hit," they added.
A builder D Subramanyam told 'The Hans India' that in view of the conflict between Ukraine and Russia, the cost of steel has abnormally shot up. He said that prior to the war, steel rate was Rs 75,000 per tonne. But after the war, price has shot up to Rs 90,000 per tonne. He said that besides steel, labour charges have enormously increased and buyers are not coming forward to purchase the material. Consequently, the construction works have come to a halt, he added.
Speaking with The Hans India, a resident G Hymavathi said that she wanted to construct a house last year, but postponed due to Covid -19. Now, she cannot build a house in view of the abnormal prices of raw material and also increased labour charges. 'The builder, who agreed to build the house at Rs 35 lakh last year, now informed that he can build it at a cost of Rs 42 lakh.'
Confederation of Real Estate Developers Association of India (CREDAI) Rajamahendravaram Honorary Chairman Buddiga Srinivas said that construction sector was the badly hit by successive setbacks like demonisation, GST, Real Estate Regulatory Authority (RERA) Act. He said rate of cement per bag was Rs 280 to Rs 300 last year, whereas now it is Rs 400 per bag. Informing that since cement is not a luxury item, the GST charges on cement are high and fixed at 28%, he pleads for reduction to 12%.
Srinivas noted that both Central and State governments should curb the attempts of steel and cement industries to form as a union, which would increase the rates. He urged both the governments to constitute a committee to revive the construction sector, which is in crisis. He also said that the registration charges should be reduced to protect construction sector.