Real estate sector in Visakhapatnam hits rough patch in 2022
The Hindu
Lack of clarity over the city’s ‘executive capital’ tag, absence of new projects and fears of a global recession are factors that have contributed to the slump, say observers
The real estate sector has hit a rough patch this year in Visakhapatnam, with several factors such as lack of clarity over the status of the Executive capital, absence of new projects and a fear of global recession contributing to the slowdown.
Honeyy Group senior business development manager B. Kanaka Raju explained the challenges behind selling residential plots and flats in apartments.
“While people buy flats either to reside in them or as a mode of investment, purchasing plots is purely an investment. The investment benefit business has been dull this year and there has been no growth in the sale of flats. The reason is due to no visible signs of the executive capital being established in the city,” he said.
Realtors blamed the State government for the slowdown in business. They feel that the rise in home loan interest rates has also played a part in the slump.
“The interest rate on home loans has increased this year. It seems to have increased by one or two per cent. When it comes to repayment of loans or EMIs, it will translate into a big amount,” Fortune Properties managing director Fahim Mudassar said.
Speaking to The Hindu, State Bank of India assistant general manager D. Tapodhan said that the interest rate on home loans has increased to 8.6-9.45 per cent for April-December 2022 from 7.8-8.4 per cent for the corresponding period in 2021.
“We do not think the interest rate hike will affect the real estate business. A person who takes a firm decision to buy a property does not think about the interest rate. We have registered a growth of around 1 to 2 per cent in home loan sales this year until December as compared to the same period last year. The business was good in 2020, but not so in 2022.” Mr. Tapodhan said.
While residents are worried over deaths due to diarrhoea in Vijayawada, officials still grapple to find the root cause. Contaminated drinking water supplied by VMC officials is the reason, insist people in the affected areas, but officials insist that efforts are on to identify the disease and that those with symptoms other than diarrhoea too are visiting the health camps.