“The cost of housing has increased because raw materials like cement, tiles, iron, all metals, among others, have increased. The cost of construction has risen by Rs 150-200 per sq ft and this may rise further as a result of rising fuel prices,” said Confederation of Property Developers (CREDAI), Indore Chairman Gopal Goyal.
Developers have said that in Indore, the average cost of building a residential and commercial property has risen from Rs 1,300 sq ft to Rs 2,500 sq ft. They said the likely rise in fuel prices in March would increase the cost of logistics and could further increase the cost of construction.
Homebuyers would then have to shell out more to buy a home, as developers would pass on higher costs to consumers, industry experts said.
“The cost of housing was already on the rise since the outbreak of the pandemic. The cost of construction jumped about 25% and now this war in Ukraine has increased the cost of supplies even further. A major impact on the cost of raw materials is expected to be seen within a month as the supply chain is disrupted,” said Aayush Zanzari, commercial manager of a real estate company.
Despite rising construction costs, the demand for residential properties seems to be good in Indore. “The real estate market is firm with good demand for residential units, although March is generally still a little slow as people get busy closing the books. We expect the real estate market to also firm up over the next fiscal year,” Goyal said.