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There is some good news for the residents of Bhubaneswar, who are longing to have dwelling units. Thanks to the ongoing recession, the property prices have come down by 10% and are expected to further come down, with the Orissa chapter of Confederation of Real Estate Developers Association, India (CREDAI) announcing a 5-10% reduction in property prices of its new housing projects.
With the state attracting Rs 4.7 lakh crore investment, including two biggest FDI proposals by ArcelorMittal and Posco, the prices of the property in the city have gone up four-eight times in the last five years. Unlike metros, the demand for houses outstrips supply giving some solace to the developers, who expect nominal reduction in prices.
"There is a mismatch between demand and supply of houses in the city. Against the demand for nearly 10,000 houses, both the public and private sector developers have been able to build only 6,000 dwelling units. If you take into account the demand from the economically weaker section, the gap is very huge," says K C Satapthy, member, planning, Bhubaneswar Development Authority. |
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During the last two decades, BDA has been in charge of developing Bhubaneswar as a neatly planned city and providing housing projects and residential plots to all categories of the populace. The vision document for Bhubaneswar-Cuttack Urban complex — VISION - 2030 — is now in the final stage of preparation by IIT-Kharagpur, Satapathy adds.
Developments in sunrise sectors such as information technology, biotechnology and mega investments projects in sectors such as airport, steel, aluminium, mining, power, railways, road, port, hospitality and manufacturing sector had jacked up property prices in the state capital. The slowdown in all these sectors will have its impact on property prices as well.
As the state government owns around 80% of available land, there is a race to corner 20% of the land. "The state government should come out with a clear-cut real estate and land consolidation policy for the capital city. The economic slowdown will have an impact on real estate in the city as the demand for houses is still growing by leaps and bounds," says Jitu Mohapatra, chief executive, Orimark, a leading property consulting company here.
Of late, the country's leading real estate companies have taken land from the government to construct up huge properties. DLF has taken 54 acres of land from the state government-owned IDCO near Infocity at Chandrasekharpur where it is coming up with 40 lakh sq feet floor space to accommodate an IT Park, shopping, hotels, retail and residential apartments. Similarly, Unitech emerged as a successful bidder for 11 acres of land leased out by the BDA to develop commercial properties such as multiplexes, retail and office space.
Vipul Group is developing a 19-acre township in a public-private partnership mode with Orissa State Housing Board (OSHB). The integrated township will have 85% built-up residential space and 15% of the space will be utilised for commercial units, including shopping complex, multiplex, schools, healthcare centres and green zones.
The integrated township will provide 1,044 dwelling units. "We expect a facelift of the city once BDA comes out with the CDP for the city. Besides, residents are looking for the outcome of the projects by mega-developers. Nonetheless, we are under pressure because of the economic slowdown," admits D S Tripathy, general secretary, CREDAI.
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