Bengaluru: The recent revision of guidance values will increase apartment prices and add to the burden of people who are yet to register properties bought years ago, experts said.
Buyers might have to shell out 10%-15% more for buying apartments in newly launched projects as developers will be looking to pass on the hike in guidance value to customers, not to speak about sand and cement prices that have been north bound for some time now, they pointed out.
While the pricing of completed projects is mainly governed by demand, the guidance value becomes a deciding factor in pricing new projects, some builders said. "The impact of the rise in guidance value comes with a time lag, so a minimum of 7-10% increase in prices can be expected in the next six to nine months," Credai sources said.
A flat in Bengaluru costs anywhere between Rs 25 lakh and Rs 5 crore, depending on the size, location, and quality of construction. There are about 1 lakh flats under construction, only half of which have been booked.
The current guidance value for apartments (with mosaic/ceramic flooring) in Kudlu, near Electronics City, is Rs 2,100 per sqft compared to Rs 1,800 a few days ago.
In Sarjapura (Anekal taluk), the guidance value in some places was Rs 880 sqft and Rs 560 in other places. However, the market value of flats here is almost four times. Now, the guidance value has gone beyond Rs 1,000 mark in most areas of Sarjapura.
Homebuyers say the registration value of an apartment should be calculated at the time of its booking, not after that. "On one hand, buyers suffer from endless delays by developers, and on the other, the registration cost keeps rising. This has added to pressure on the middle-class buyers," said K Suman Dasti, a businessman who recently booked an upcoming apartment off Bellary Road.
A reputed builder also said many apartment projects on the outskirts of Bengaluru were started when guidance values there were around Rs 500-Rs 1500 per sqft till 2012. Many buyers would have made bookings then. Guidance values for apartments in these areas are anywhere between Rs 1500 and Rs5,000 per sqft.
BDA BUYERS IN SOUP
The new guidance values will also affect people who were allotted flats by the Bangalore Development Authority (LDA), but the registration of the same was not done.
Allottees in ambitious projects in Bengaluru north taluk will be the worst-hit since guidance values for apartments in these areas have gone up by 5-35%. Same is the case at Kudlu, near Electronics City, Sarjapur (Anekal taluk), Horamavu, Bannerghata Road and Hosur Road where vertical growth is rapid and vibrant.