Madurai: The prices of building materials such as cement, sand, blue metal and iron rose by 30% in just two weeks, which shocked consumers and led to a corresponding increase in construction costs. Many say they cannot finish their homes if this is the trend.
G Annadurai of Gomathypuram, who has started building two additional bedrooms, says a price increase of this magnitude is unprecedented. “When I started construction in March, I bought a ton of iron bars for 58,000 rupees, but on Friday it is 74,000 rupees. That will make it very difficult for builders like me, ”he said.
S Shankar from Vilangudi says he started building his 1,200 square meter house with a Rs 50 lakh loan. “Even if I cut all set-up costs, it will cost me over Rs 80 lakh, which is beyond my budget,” he said.
He points out that many like him would need to start repaying bank loans for unfinished homes when the designated time for repayment begins.
While developers who started projects have put them on hold, individuals who have received bank loans are in dire straits. M Ganeshan decided to start building his house in December 2019. He started work, but it slowed down due to Covid.
Realizing that he could not continue construction because of rising costs, he tried to sell the incomplete structure, but could not find a buyer.
“ My estimate was Rs 50 lakh, and now with the bank loan I have to sell it for at least Rs 90 lakh, ” he said. An Asokan from Makkal Sakthi Iyakkam, who is under construction, says that an increase in the price of cement is to be expected whenever a new government takes the lead, as there is a large lobby for it. “But to increase from 370 rupees to 520 rupees in less than a month is way too much,” he said, adding the government should take steps to contain prices. Rising fuel prices are cited as a further reason for the price increase.
Engineer G Raja, a building contractor, says builders were hit hard during the last lockdown, but now material prices made it even more difficult for them.