Hyderabad: The construction industry has been adversely affected due to the coronavirus lockdown on the one hand and Dharani portal Registration and the layout issues on the other hand. Big projects were canceled. Individual home construction activity decreased. The demand for iron, cement, and other construction materials decreased too.
According to the market trend, the decrease in demand must bring down the prices. But this is not the case. Defying the demand and supply rule, the prices for iron and cement are soared in recent times.
Compare to the pre-lockdown prices, the current prices are increased many folds. About Rs.50 has been increased on a sack of cement and Rs.20, 000 on a ton of steel.
The cement prices between January and December last year registered a 23% increase while it was 55% for the Iron. A sack of cement pre-lockdown was Rs.270 which is being sold at Rs.335 now. Likewise, the cost of a ton of steel pre-lockdown was Rs.37, 000 which is being sold between Rs.58, 000 to Rs.68, 000 now.
The Union Transport Minister Nitin Gadkari expressed his concern at the sudden spurt in the cement and steel prices and termed it as a joint conspiracy by cement and iron manufacturing companies. Similarly, the prices of fuel (Petrol and Diesel) have been increased too.
A comparison of the pre and post-lockdown prices would indicate that the prices of many goods and materials are increased and the impact of such increase in prices is more evident in the construction industry. Apart from the cement and steel price increase, there is a marked increase of Rs.200 to Rs.400 in the construction cost per sq.ft. The tiles and labor charges too witnessed a price increase.
Previously the daily charge of skilled labour was between Rs.400 to Rs.500. Now the skilled labour charge is about Rs.1300/-.
Early the construction costs were between Rs.800 to Rs.1000 per sq.ft which increased to Rs.1200 to Rs.1400 per sq ft now. In the past, the construction cost of a house admeasuring 2,000 sq. ft was between Rs.20 to 25 lakhs which is increased to about Rs.35 lakhs now. An ordinary middle-class man has to bear a burden of Rs.10 lakh as an extra cost for his house construction. Similarly, the prices of the apartments too are increased substantially.