The Effects Of COVID-19 On The Cochin Real Estate Sector

03 Feb 2021 12:00 AM

The coronavirus-induced construction material price spike has had a considerable effect on the Kochi real estate industry. As per several architects and builders, expenses have gone up by around 30% in the past few months. A combination of factors contributes to the spike; here, we will look at which factors might affect the prices of apartments in Cochin.

The Kerala government may have made some relaxations to improve the economy after a crippling nationwide lockdown, but several industries are still in a crisis zone. The quick increase in the rates of materials such as iron, PVC pipes, cement, and steel has affected construction and commercial/residential real estate. That is remarkable, especially because it is among the few industries that have a high potential for job generation.

The virus-induced lockdown made many factories close down, so the creation of building materials has come down. Limitations on the process of importing those components from China have also contributed to the price spike. The steel import from the nation has considerably reduced. The majority of that material is brought in from states such as Andhra Pradesh, Chhattisgarh, and Tamil Nadu.

Several non-Kerala laborers have started to go back to their native states, so skilled workers are in short supply. As for several builders, that lack of skilled workers is negatively affecting the industry. So much so, many of those builders are booking flight tickets or using luxury buses to get back those skilled workers. Most of those businesses are made to hire laborers on increased wages to finish projects punctually because almost all of the latter would not work for their previously agreed-on rates.

Moreover, the continuing restrictions on Kerala quarries result in the situation of gravel being unavailable. Local-level problems hinder the seamless material availability. Some quarry owners that sell at higher prices are taking advantage of the situation. The Pinarayi Vijayan-led government has also promised many relaxations for this industry, but several issues are yet to be fully addressed. In the event of things not improving, the industry might face a situation characterized by a lack of progress.

Besides, beyond just high-profile real estate firms, even commoners who continue to build houses are struggling to survive financially amid this price spike. That means the situation not only impacts the construction of flats in Kochi city. Nevertheless, everyone is expecting the condition to improve.