The Confederation of Real Estate Developers’ Associations of India (CREDAI) has approached the Prime Minister Office to pull some reins on the increasing prices of steel. The complaint mention that the prices of steel have undergone a surge in the last year and are impacting the overall real estate market.
“It is imperative that the government intervene and regulate prices for the benefit of all stakeholders of real estate, especially the consumers, who are having to bear the cascading effects of the increase in costs,” ET Realty quoted Jaxay Shah, CREDAI president, as saying.
It is noteworthy here that the steel prices have gone from Rs 29,000-32,000 per kg in 2016 to Rs 51,000-54,000 per kg at present. The sudden increase of 40 percent is bound to impact the real estate market.
Since the input cost has gone remarkably up, the association claims that it is becoming difficult to come up with affordable housing for lower income group. The increase in steel prices is being attributed to the recent hike in import duty on steel. Although the import duty was increased in-line with Make In India ideology, domestic suppliers see this as an opportunity for a price hike, claimed Shah in the CREDAI plea.
The 40 percent hike in steel prices is burdening the real estate sector with an additional cost of Rs 90-180 per square foot depending on other variants like height, basements, etc., as per the association. CREDAI also declared that due to hike in steel prices, developers are finding it tough to source raw materials, leading to obstacles in the completion of real estate projects.
