Shimoga's real estate business hit by crisis

Shimoga's real estate business hit by crisis

Property registrations come to a near standstill

Registration of property at sub-registrar’s office in the city has almost come to a halt, as buyers are in wait and watch mood and businessmen are confident that political crisis will be resolved.

Cost of land in Shimoga has skyrocketed with Yeddyurappa as Chief Minister announcing a slew of infrastructure development projects in the city like construction of airport, conversion of Shimoga-Bhadravati stretch of NH 206 into four lanes and laying of concrete roads. Foundation stone was laid for the establishment of IT park and projects like a SEZ for auto components and textile park were also in the pipeline. Against this background, sites  in the City, which were traded at Rs 1,000 per sqft has hit Rs 4,000, However, sites on the outskirts which cost Rs 400 has reached Rs 1,000. Rent of houses in Tilak Nagar, Gandhi Nagar, Basavanagudi, Rajendra Nagar and Ravindra Nagar have seen four times increase. As cultivable lands on the City’s outskirts were converted into layouts, cost of the same raised from Rs 2 lakh per acre to Rs 10-15 lakh.

Situation is similar in Shikaripur, the chief minister’s home town. Many eyebrows were raised when a hotel at KSRTC bus stand in the city was auctioned for Rs 48,000 per month, as rent. Rise of land cost can be attributed to rumours about the establishment of a sugar factory in the region.

Shimoga District Chamber of Commerce and Industry President K V Vasant Kumar told Deccan Herald that real estate rates in the city is hyped by a few rich persons to enhance the value of their existing property. A hike in rates devoid of change in the socio-economic condition of people here were unrealistic. It is unfortunate that a boom in real estate is being attributed as development.

Seasoned realtors opine that real estate business in the city is in a correction mode now,a situation which was witnessed, when the J H Patel-led government collapsed. People in the real estate business have ruled out sudden slump in the market. However, they are sure that the land rates would come down once the Yeddyurappa government fails.