Realty dream sours as land prices go south in Amaravati

VIJAYAWADA: Glossy designs of skyscrapers amidst landscaped gardens, picturesque artificial lakes, a metro rail network and super-wide roads accompanied by a high-pitched publicity blitzkrieg attracted everyone’s attention to the greenfield city of Amaravati.
IT professionals, doctors, businessmen and many from the middle classes in AP and Telangana looked at the upcoming dream capital city of the Andhras as a new destination to own a house.They saw a new Hyderabad emerging in Amaravati and borrowed from banks to buy property. Many of them pooled money for joint investment.

The dream, however, did not long last and many of the investors in real estate in Amaravati are uncertain about the future of their investment now. With a lull in construction and the state government silent on the future of the capital, the Amaravati dream seems to have soured.
Those who invested in Amaravati are staring at the capital getting eroded with depreciating land values.
As land prices in Tullur and Mangalagiri mandals skyrocketed immediately after the then TDP government announced the location of the capital five years ago, people had come up with an innovative idea of pooling money to buy plots or houses.
Gangadhar, a software engineer, had joined hands with four of his friends to buy 0.5 acres near Neerukonda village. Together they invested Rs 1 crore to buy the land with equal share among themselves. “After seeing the grand plans of the previous government to develop Amaravati as one of the best cities in the world by taking Singapore on board for master plan development and the city prototype graphics that followed, we thought it was a wealth creating opportunity. But now land values have come down by more than half. As on today if we want to come out of the investment, we have to sell the land for 50 per cent less price,” says Gangadhar.
Same is the case with Dr M Harshavardhan from Khammam in Telangana, who works in Singareni Collieries. He and 11 others purchased two plots. Interestingly, some of them with whom he is sharing the undivided land do not even know him. He said he came to know about them through a friend. “We have people from Jangareddygudem, Gannavaram, Manuguru, Rajahmundry and Hyderabad in our group,” says Harshavardhan, adding that he purchased the land as a long-term investment for the marriage of his daughters.
“At the time we bought the lands, the situation was like we may not get the chance again if we miss the opportunity. As I had studied medicine in Guntur, I have personal connect with the area too and decided to invest in Amaravati with the hope that the value will get appreciated as the city takes shape. But now the situation looks grim with the uncertainty over the capital city project,” he rues.
Rajendra, a real estate broker from Tullur, said he used to get about 10 enquiries a day but now he is getting calls only from worried investors. “Everyone is worried about ending up in losses if the capital project does not take the shape as it was projected to be,” he says.
Many land transactions took place in nearby villages like Pedaparimi, Neerukonda, Khaja and Namburu too, apart from the capital villages. People, who purchased in groups, are mostly employees. “We have facilitated land purchases for employees of banks, railways, software companies and even government departments. All of them are worried about their investments now,” adds Rajendra.