Realtors, clients rushing to Dhaka suburbs

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Visitors crowd stalls Friday at the REHAB fair being held at Dhaka Sheraton Hotel in the city. — FE photo

Mehdi Musharraf Bhuiyan
Continued dearth of land in Dhaka's generally sought-after areas and the consequent property price-hike have pushed up the value of real estate in the city's upscale zones by almost 50 per cent from that of last year as could be seen at the ongoing REHAB Fair in the capital.
This trend, the organisers said, is breaking the monopoly of Dhaka's traditional top-choice residential destinations and forcing the real estate companies to move beyond the capital as the target middle-class buyers are looking for their abodes elsewhere.
According to the leaders in the real estate sector, the average per square feet price of apartments in the city's elite Gulshan, Banani or Dhanmondi area now ranges between Tk. 11,000.00 to Tk. 16,000.00; up from the range of Tk. 7000.00 to Tk. 12000.00 a year ago.
"This is mainly because of the soaring trend of price of the landed property in those areas, prompted by the shrinking of vacant lands in the growingly overcrowded localities," said Md. Nasifur Rahman of Sheltech.
"The rate of increase in apartment price in these areas is negligible compared to the rise in land prices in these neighborhoods" said Tanvirul Islam of Amin Mohammad Foundation, another local real estate giant.
"While the construction cost has remained the same, the hike in land price has pushed the value of apartments in these areas", he added.
Explaining the situation, leaders in the real estate sector opine that most of the realtors actually have done fair enough to keep the apartment prices within the range of the customers due to the increased competition among the real estate companies.
"The land price has gone up by more than 50 per cent in the city's posh districts in one year -- but compared to that the rise in apartment price, in cases, has been kept as low as 35 to 40 per cent", said Tanveerul Haque Probal, president of REHAB, the national trade body of realtors and the organiser of the fair.
"Such an increase has also led the leading realtors to look beyond the capital," Probal added, saying, "a number of real estate companies in this year's fair have showcased projects based outside Dhaka".
However, the picture was not obviously the same for all parts of Dhaka city.
While the real estate price has seen a rapid increase in the older and growingly overcrowded downtown, it has been observed that no significant rise in apartment price is noticeable in the traditionally middle class or the so-called newer parts of the city.
"Areas like Uttara and Mohammadpur are growingly becoming a popular destination for the middle class people," said Tareq Md. Aminul Islam of Rupayan Housing Estate.
"People prefer especially Uttara, which is still partly free of the land price hike due to huge amount of vacant land on offer."
According to insiders in real estate sector, the uptrend in the real estate price is likely to continue in line with the increasing demand for land and housing in the capital.
"Whereas the annual demand for apartments in the capital is 100,000 units, only 6,000 units are actually there each year on the supply side," said M Hossain of Concord.
"While, there is no evidence of downtrend in real estate prices in the country in recent times, the proposed construction of four satellite towns could partly solve the ongoing housing crisis in the capital and could deflate the real estate price boom,", said Mr Probal.