Amaravati dream turns sour for realtors and farmers

Amaravati: Real estate in the capital city area has been witnessing a downturn, contrary to expectations of a boom. The fact that buyers are staying away from the Amaravati region is a major cause of concern for both the farmers who own plots and realtors.

Land rates which soared in the past 12 months came crashing down following the low demand. The delay in finalisation of the land pooling scheme layouts is one factor behind this slump. The government's failure to translate at least some of its promises into reality is another.

According to sources, realtors went on a land buying spree in the area soon after the capital city announcement but most are now trying to off-load their investments. One of them purchased about 360 acres in bits and pieces in CRDA villages. At present, he is busy scouting for buyers. The realtor, who initially picked up land at Rs 30 lakh per acre about a year ago, went on to spend as much as Rs 1.2 crore on acre of land. His average spending was around Rs 70-Rs 80 lakh per acre. His dreams of striking it rich have crumbled as the realty bubble has burst. Now he is hard pressed to sell the land at Rs 1.4 crore to Rs 1.5 crore an acre so that he could repay the money he borrowed from friends and relatives.

Like him, over a dozen realtors are desperate to get rid of the land. They are worried about further losses once the layout for farmers is ready. This trend is creating ripples in the capital city area. Farmers, particularly from the river bank villages, who dreamt of selling their plots for a princely sum of Rs 2 crore per acre, have been disappointed by the recent developments.

"Speculation is rife that the government has been deliberately delaying the finalisation of the layouts only to let the market cool down as majority of the small farmers are eagerly waiting to sell their plots soon after receiving land pooling ownership certificates," a builder said. The farmers worry that the rates might further go down in the coming months.

The moves to keep on postponing the finalisation of layouts, citing one reason or the other, is giving credence to the rumours. In fact, the developed plots were supposed to have been distributed by March end. "It might take another four to five months to complete the process," said a senior CRDA official.

A realtor, G Venkateswara Rao, said that they are not expecting the situation in the capital city area to improve even after completion of makeshift secretariat and express highway as there are no big prospective buyers.