Construction industry in the city and its peripheral areas is going to the wall. Builders and property developers have been pleading for urgent government help to bolster the struggling sector, but nothing much has changed on the ground level.
That the construction industry is at a very low point is attributed to the grim economic scenario by many.
“The gradual decline continues without much sign of improvement, and it is evident that we may not yet have seen the bottom of the trough,” says senior builder and president of Greater Vijayawada Builders’ Association Gadde Rajaling.
“It’s the sagging Indian economy. In spite of dollar appreciating so much against rupee, not much has improved. Housing has become a non-priority for people as project costs have gone beyond their affordability.
Look at the new ventures, they are not viable any more. We are actually clueless about our next course of action, everybody seems to be in the dark,” he rues.
Rising prices of almost everything under the sun have had their impact on the affordability of the middle and the lower middle classes. Citing the ever-increasing prices of petrol and other fuels, essential commodities and the exorbitant rise in the cost of education, builders opine that this leaves little savings for people to invest in assets like residential properties.
“The construction sector is undeniably facing significant headwinds essentially because of limited public investment and an extended weak economy,” admits R.V. Swamy, vice-president of CREDAI (Confederation of Real Estate Developers’ Association of India), Vijayawada chapter.
“At this point, there are nearly 1,000-1200 ready-to-occupy flats available in the city and its fringe areas. Despite offers of attractive packages such as fully-furnished houses along with car parking, we are unable to find buyers,” says Mr. Swamy, who continues to search for buyers for his 90-odd new flats, including 50 flats at Currency Nagar, built by his company Sai Karthik Builders.
The NRIs, the builders inform, who comprised important chunk of property buyers in this region, are conspicuous by their absence.
The moot question that haunts them is, “Will the construction sector see any significant improvement in its fortunes after its very difficult start to 2013 and a pretty torrid 2012?”