Following The Example Set by Maharashtra Developers, Realtors in Delhi-NCR Threaten to Suspend Development if Raw Material Costs Spiral Further

Following the Maharashtra CREDAI chapter's threat to suspend building due to rising raw material costs, developers in the Delhi-NCR region have chosen to follow suit.

As per CREDAI-NCR the sudden and rapid surge in expenditures has undermined real estate projects' razor-thin margins, leaving them unviable. The developers have suspended material procurement, fearful that the higher costs may ultimately cause the project to stop.

This statement follows a similar one made earlier this year by developers in Mumbai and Pune.

According to CREDAI NCR, an industry association representing real estate developers, input costs have climbed by a weighted average of roughly 30% to 40% in the previous two years, while the prices of a few goods have increased by more than 100%.

According to developers, steel prices have grown by 121% and cement prices by approximately 38% in the previous two years, and the cost of construction has increased by at least Rs 500 per sq. ft., rendering projects unviable.

CREDAI-NCR President Pankaj Bajaj opined that as a consequence of global supply chain disruptions, prices of crucial raw materials used in construction, such as steel and cement, have soared. Following COVID-19, the current recession has dealt real estate developers a double blow, since they are unable to complete projects on time and under budget. Steel prices, in particular, have worsened to the point that suppliers are reluctant to take orders even at enhanced prices.