Oil crisis hits realty sector

KOZHIKODE: With the dip in oil prices hitting the Gulf region, its tremors are felt in Kerala, heavily dependent on overseas remittances. One of the badly-hit sectors is construction, especially of independent villas. There is also confusion over apartment complexes of leading builders.

“The construction sector in Kerala, especially Malabar, is heavily dependent on the Gulf money. Usually, after spending a few years in the Gulf countries, people try to build minimum one independent house or buy a flat here. But for the past three-four months, there are very few buyers for houses and there is a delay in decision-making. People are either returning after being fired. Some are under fear of losing jobs or a cut in salaries,” Confederation of Real Estate Developers Association of India (Credai) Calicut chapter president M. A. Mehboob said.

After the oil price crash, GCC states like Saudi Arabia, Oman and Bahrain, where more Keralites are living after the UAE, have announced austerity measures. They are finding ways to cut spending, and there's a dip in domestic demand.

He also shared the hope that more working people would arrive in the city boosting the demand for budget houses. “From Malappuram area alone, where we otherwise have the most number of homebuyers, we received no new enquiry for independent villas for the past two months. The positive fallout is that some are relocating their businesses to Kerala and building their shops here,” HiLite Constructions Kozhikode branch head C. Ravi Shankar said.