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Firming prices

Your dream home becoming very expensive? The culprits are not demand pressure and local infrastructure improvements alone. The factor you’re overlooking is construction costs.

Print Edition: February 21, 2008

Your dream home becoming very expensive? The culprits are not demand pressure and local infrastructure improvements alone. The factor you’re overlooking is construction costs. Cement, which accounts for a good 10-12% of this has seen a sharp price rise.

Then:
A 50-kg bag of cement was priced at Rs 110 in 1998

Now:
A bag of cement now costs about Rs 245, a whopping increase of 122% in the last 10 years

Then:
If prices of cement keep rising at the same rate, a 50-kg bag may cost Rs 543 in 2018

If you are planning to build a house, re-look at the proportion of your budget allocated to construction costs. They may need to be pushed up quite a bit. Those looking for home renovations that require construction should do fresh calculations too. And not just for cement. Steel prices have been running up as well. Watch this space for more.

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