Chennai, July 13
Property developers’ body Confederation of Real Estate Developers’ Association of India-Chennai on Wednesday said the time is ripe for people to buy homes now as the present ‘attractive’ prices may not be there for long.
The home prices may see an increase in the range of 10-15 per cent in the coming quarters due to an escalation in construction costs. Builders will have to increase the prices in the coming months to pass on the cost increases, said Sivagurunathan, President, CREDAI-Chennai.
He said the cost of input materials such as steel, cement etc remained at much higher levels despite the recent drop in prices. While there is a cost escalation in construction, there is also a drop in unsold home stock in the Chennai region. There are only 5,000 unsold units in the region. Interest rates are also increasing from the lowest regime in the past. It is unlikely to come down in the near future.
CREDAI Members also discussed the improving regulatory environment and government support for the realty industry in the state. If the implementation of the single window system by the Chennai Metropolitan Development Authority (CMDA) becomes successful, it will be a big boost the industry.
“We are also hopeful that the same system is extended to layout developments as well,” he added.
Chennai’s residential market has been driven by an increasing demand near the coastal areas due to the presence of IT corridors and employment hubs. The demand (searches) grew 13 per cent in June 2022 quarter (as compared to March 2022 quarter) while the supply (listings) grew 5.1 per cent with an increase of 1.6 per cent per cent in the average property rates. Homebuyers in the city seem to have a strong preference for mid-segment and premium properties (₹5000-10,000 per sq ft) over affordable housing and 2-and 3-BHK configurations continue to hold a majority share in the market, said a recent report by Magicbricks.