Mangaluru, Oct 15: The construction sector in Dakshina Kannada is reeling from a severe crisis as new government regulations and slow licensing for laterite quarrying have caused a massive surge in material costs. The price of laterite stone has nearly doubled, pushing the total construction cost of a budget home up by a staggering 33%, and making it significantly harder for the common man to afford a house.
The Price Shock
The core of the crisis lies in the key building materials:
• Laterite Stone: The price of a single laterite stone has soared from approximately Rs 29 to Rs 55. This astronomical rise is directly attributed to the new set of rules for quarrying and the subsequent bureaucratic delay in issuing licenses.
• Sand: The unavailability of sand, particularly from Coastal Regulation Zone (CRZ) areas, has compounded the issue. A load of sand that cost Rs 7,500 prior to the crisis has now shot up to Rs 17,000. Even the alternative, M-Sand (manufactured sand), is priced high at Rs 11,500 per load.
As a direct consequence of these material price hikes, the total construction cost of a budget house has risen sharply from a moderate Rs 1,800 per square foot to Rs 2,400 per square foot. For a 1,000 sq ft house, the cumulative expense for just the stones (3,000 required) and eight loads of sand is now scuttling the initial budget by an extra Rs 2 lakh. Minor dips in the cost of cement and steel are insufficient to offset this massive material inflation.
Supply Collapse and Industry Impact
The regulatory environment has decimated the material supply chain:
• Production Halt: Earlier, both legal and illegal quarrying supplied close to six lakh laterite stones daily in Dakshina Kannada. Following the new regulations and licensing norms, this output has plummeted to just one lakh stones per day.
• Quarry Closures: Mahabala Kottary, president of the Civil Contractors Association Dakshina Kannada (DK), highlighted the operational shutdown: four months prior to the government's halt, there were 750 quarries operating; now, hardly 28 are functioning.
• Construction Delays: The acute shortage is causing delays for many house owners who are "adamant" about using laterite stones for the whole house. Some builders are now turning to alternatives like cement blocks (costing around Rs 25 per block) for inner walls to keep construction moving.
Stakeholders, including Credai Mangaluru, express cautious optimism, suggesting that it will take at least two to four months for the situation to stabilise. They anticipate that streamlining the quarrying process and securing CRZ blocks for sand will ease the pressure and potentially pull down the construction cost by at least 10%. However, civil contractors note a discernible downward trend in new construction activity, particularly for independent houses in urban areas, despite applicants already having building permits.
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