Soaring oil prices may push up real estate costs
Brent crude oil prices have jumped from $70 to $75 to over $105 a barrel since February, mostly due to tensions in West Asia.
This is set to push up construction costs for real estate projects across India, with fuel and logistics facing significant pressure.
Fuel and logistics facing significant pressure
Higher diesel prices mean it'll cost more to transport essentials like cement and tiles, raising overall building expenses (typical mid-range estimates are about ₹1,500 to ₹3,000 per square foot, depending on location and finish).
On top of that, aluminum is up 6% to 10% thanks to fewer Gulf imports, steel is pricier due to energy costs, and there are delays getting PVC pipes and tiles because of gas shortages, so supply chain headaches might last another quarter or two.
Developers are still aiming to deliver projects on time
Despite all these challenges, NAREDCO chairman Niranjan Hiranandani says developers are still aiming to deliver projects on time.
He notes logistics cost pressures but says developers expect timelines and deliveries to remain on track and that the industry is positioned to adapt through efficient sourcing and cost management.