Every property in Ranchi is hot now, thanks to a skewered demand and supply ratio.
Prices of apartments and commercial spaces are heading north in the capital, in tandem with spiralling cost of building material, scarcity of land following strict implementation of the Chotanagpur Tenancy Act (CNT), too few readymade options and civic guardians dragging their feet when it comes to clearing multi-storied building plans.
The situation in much in demand Lalpur Chowk is a classic example of how prices have soared. The per square feet rate for an apartment in Lalpur Chowk (opposite Arya Hotel) is Rs 4,000 to Rs 4,500. So, a 1,00sqft two-bedroom flat would cost over Rs 40 lakh. However, most of the flats available are around 1,800sqft, with a price tag of over Rs 70 lakh. Two years ago, the rates were almost half.
The picture is similar between Dangra Toli Chowk and Kantatoli Chowk, where the per square feet rate of an under-construction flat is Rs 3,300, up from a paltry Rs 1,500 to Rs 2,000 a couple of years ago.
Flats in Lowadih, which cannot really be termed a posh locality, are not selling for less than Rs 2,000 to Rs 2,500 per square feet. Last year, the same flats were for the taking at Rs 1,500 per square feet.
If prices of residential apartments are already beyond the reach of the so-called middle class, the rates of commercial spaces in upmarket localities can only be termed stratospheric. Space in an upcoming multi-storied office building in busy Lalpur Chowk, along Circular Road, is being sold at Rs 15,000- Rs 18,000 per square feet while in Dangra Toli, the same kind of premises are available for Rs 5,000 to Rs 8,000 per square feet.
The builders blame the rising real estate prices on high cost of building material.
“A 50kg bag of cement, the most basic construction material, used to cost less than Rs 300 till last year. But now, prices vary between Rs 370 to Rs 380 per bag. Rates of bricks, sand etc are also at an all time high. Moreover, there are very few plots available either on conversation basis or on ownership basis,” said well-known city builder N.K. Mishra.
Mishra is developing a residential complex in Morabadi area where the minimum asking price per square feet price is Rs 3,000.
“Most of the ongoing construction projects stalled six months ago after the CNT fiasco. Banks stopped giving loans while availability of clear land (out of CNT purview) is low. The minimum construction cost is Rs 1,200 per square feet while if we add to conversion and price of the land, it becomes double or in some cases even more,” said Mishra, trying to explain the logic behind the price rise.
Rates of bricks have also increased to Rs 10,000 (per two thousand bricks), which used to be around Rs 6,000 a year before. The rise in rates is also being attributed to loss of public faith in big housing projects following the trouble with Sanjeevani Buildcon and Samridhhi Creative.