Rapid urbanisation boosts housing in district towns

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</div> <div class="date"> 25 April, 2022, 10:40 pm </div> <div class="date"> Last modified: 27 April, 2022, 11:45 am </div> </div> </div> </div> <div class="panel-separator"></div><div class="panel-pane pane-custom pane-2 margin-top-2 no-title block" class="panel-pane pane-custom pane-2 margin-top-2 no-title block"> <div class="pane-content"> <script type='text/javascript' src='https://platform-api.sharethis.com/js/sharethis.js#property=647431098b79010019949994&product=inline-share-buttons' async='async'></script>  <div class="sharethis-inline-share-buttons"></div>  </div> </div> <div class="panel-separator"></div><div class="panel-pane pane-related-news margin-top-2 hide-for-small-only no-title block" class="panel-pane pane-related-news margin-top-2 hide-for-small-only no-title block"> <div class="pane-content"> <div class="most-views"> <h2 class="widget-title bar-red text-uppercase">Related News</h2> <ul> <li><a 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type="application/ld+json">{"@context":"https:\/\/schema.org","@type":"BreadcrumbList","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/tbsnews.net"},{"@type":"ListItem","position":2,"name":"Economy","item":"https:\/\/www.tbsnews.net\/economy"},{"@type":"ListItem","position":3,"name":"Industry","item":"https:\/\/www.tbsnews.net\/economy\/industry"}]}</script> <article id="node-409494" class="node node-news odd view-mode-full"> <header> <h1 class="hide-for-small-only " itemprop="headline"> Rapid urbanisation boosts housing in district towns </h1> </header> <div class="author-section show-for-print"> <div class="author-name"> <strong class="color-black"><a href="/author/rezaul-karim">Rezaul Karim</a></strong> </div> <div class="date"> 25 April, 2022, 10:40 pm </div> <div class="date"> Last modified: 27 April, 2022, 11:45 am </div> </div> <div class="section-media position-relative featured-video featured-image"> <div class="media-youtube-video media-youtube-1 media-responsive"> <iframe class="media-youtube-player" width="640" height="390" title="Rapid Urbanisation Boosts Housing In District Towns | The Business Standard" src="https://www.youtube.com/embed/g2eaW87nNiQ?wmode=opaque&controls=&rel=0" name="Rapid Urbanisation Boosts Housing In District Towns | The Business Standard" frameborder="0" allowfullscreen>Video of Rapid Urbanisation Boosts Housing In District Towns | The Business Standard</iframe> </div> </div> <div class="text-center margin-bottom-1 hide-for-print"> <div id="dfp-ad-tbs_lb_snd_ahl-wrapper" class="dfp-tag-wrapper">  <pubguru data-pg-ad='TBS-LB-SND-AHL'></pubguru> </div> </div> <div class="section-content clearfix margin-bottom-2"> <p class="rtejustify"><strong>Real estate business is seeing a strong growth in the small district towns and the surrounding areas outside the major urban areas of capital Dhaka and commercial hub Chattogram. This boost for the sector has come from a number of factors – massive electrification in rural areas, rapid growth in urbanisation, and rising purchasing power of the citizens.</strong></p> <p class="rtejustify">Over the past 10 years, the housing sector has witnessed investments amounting to around Tk3 lakh crore in district towns all over the country, say industry insiders.</p> <p class="rtejustify">However, inadequate housing laws and complicated procedures for getting home loans and high interest rates from public and private banks are keeping many investors away from this sector, they add.</p><div class="hide-for-print mb-20 text-center "><div id="dfp-ad-tbs_lb_snd_middle-wrapper" class="dfp-tag-wrapper">  <pubguru data-pg-ad='TBS-LB-SND-Middle'></pubguru> </div></div><div class="hide-for-print mb-20 text-center "> <h4> <a style="font-weight: bold; color: #2b4949; border-bottom: 1px solid #ccc; font-size: 18px;" href="https://news.google.com/publications/CAAqBwgKMIivlQsw2ZKrAw?ceid=US:en&oc=3" > <img src="/sites/all/themes/sloth/images/google_news.svg" alt="The Business Standard Google News" style="display: inline-block; margin-right: 15px; margin-bottom: 10px; height: 30px;"/> Keep updated, follow The Business Standard's Google news channel </a> </h4></div> <p class="rtejustify">They think it will be easier to make housing affordable for more people with increased investments in real estate businesses in district and upazila towns with proper government plans.</p> <p class="rtejustify">According to the Bangladesh Institute of Planners, the country's housing sector got an investment of about Tk10 lakh crore in the last 10 years and about 30% has gone into housing in towns and upazilas.</p><div class="hide-for-print mb-20 text-center "><div id="dfp-ad-tbs_rectangle_snd_mobile-wrapper" class="dfp-tag-wrapper">  <pubguru data-pg-ad='TBS-Rectangle-SND-Mobile'></pubguru> </div></div> <p class="rtejustify">Professor Dr Adil Muhammad Khan, former general secretary of the Bangladesh Institute of Planners, said, "In 2021 alone, about Tk1,50,000 crore was invested in the housing sector, of which about Tk40,000 crore was spent on building houses in towns outside Dhaka and Chattogram."</p> <p class="rtejustify">Dr Adil said so far the highest investment has been made in Dhaka division. </p><div class="hide-for-print mb-20 text-center "><div id="dfp-ad-tbs_rectangle_snd_mobile02-wrapper" class="dfp-tag-wrapper">  <pubguru data-pg-ad='TBS-Rectangle-SND-Mobile02'></pubguru> </div></div> <p class="rtejustify"><div class="section-media position-relative"><span class="lg-gallery" data-exthumbimage="https://www.tbsnews.net/sites/default/files/styles/very_big_3/public/images/2022/04/25/housing-info.png" data-src="https://www.tbsnews.net/sites/default/files/styles/very_big_3/public/images/2022/04/25/housing-info.png" data-sub-html=""> <span class="open-popup"><svg><use xlink:href="/sites/all/themes/sloth/images/icons.svg#open-popup"></use></svg></span><picture >  <source data-srcset="https://www.tbsnews.net/sites/default/files/styles/infograph/public/images/2022/04/25/housing-info.png 1x" data-aspectratio="1600/1626" media="(min-width: 1024px)" />  <img class="lazyload" data-aspectratio="" data-src="https://www.tbsnews.net/sites/default/files/styles/infograph/public/images/2022/04/25/housing-info.png" width="1600" height="1626" alt="" title="" /> </picture></span></div> <p class="rtejustify">In the past 10 years, around Tk2 lakh crore has been invested in the housing sector in Munshiganj, Naryanganj, Savar, Gazipur, Narsingdi, Manikganj and Ashulia areas, he also said.</p><div class="hide-for-print mb-20 text-center "><div id="dfp-ad-tbs_rectangle_snd_mobile3-wrapper" class="dfp-tag-wrapper">  <pubguru data-pg-ad='TBS-Rectangle-SND-Mobile3'></pubguru> </div></div> <p class="rtejustify">"About Tk40,000 crore has been invested in Chattogram division, Tk20,000 crore in Sylhet, Tk20,000 crore in Rajshahi, Tk9,000 crore in Mymensingh, Tk10,000 crore in Khulna, Tk6,000 crore in Barishal and Tk5,000 crore in Rangpur division."</p> <p class="rtejustify">Entrepreneurs say people are buying plots and flats in these housing projects for living better with civic amenities similar to the capital.</p><div class="hide-for-print mb-20 text-center "><div id="dfp-ad-tbs_lb_snd_mobile3-wrapper" class="dfp-tag-wrapper">  <pubguru data-pg-ad='TBS-LB-SND-Mobile3'></pubguru> </div></div> <p class="rtejustify">In Bogura, more than Tk4,000 crore has been invested in the real estate business in the last 10 years.</p> <p class="rtejustify">Almost 20 years ago, a real estate company named Comfort Housing started business on about 10 acres of land in the Matidali area of Bogura city.</p> <p class="rtejustify">Akram Hossain, a retired principal officer of Agrani Bank, bought a plot in that project in 2018. </p> <p class="rtejustify">He said, "We have built a three-storey building in the plot and are living there. I had to live in Dhaka because of my job for a long time and life was boring. I want to spend the rest of my life in my hometown. You can find all kinds of facilities here."</p> <p class="rtejustify">Zulkar Ali Khan, managing director at Comfort Housing, said, "Real estate business in Bogura city and surrounding areas started in 1999. Many well-off people of this district are buying plots and flats from different projects where there are all civic facilities."</p> <p class="rtejustify">Sairul, general secretary of Bogura Real Estate Association, said in the last 10 years, 60 real estate companies have invested around Tk4,000 crore in Bogura.</p> <p class="rtejustify">Shafiul Alam Chowdhury Nadel, president at Sylhet Apartment and Real Estate Group (SAREG), said, "A large number of people from Sylhet live abroad. They want an accommodation for their parents or relatives in a good environment near the city. Around 500 real estate companies have grown in Sylhet based on this demand."</p> <p class="rtejustify">Mizanur Rahman Kazi, general secretary at Real Estate and Developers Association in Rajshahi, said, "Many people in Rajshahi who have government jobs and enough money are buying plots and flats. Rajshahi has a good communication system with other parts of the country. It also has an airport."</p> <p class="rtejustify">Sector insiders say the demand for plots and flats in the natural environment beside the sea and the hilly areas of the country is also increasing.</p> <p class="rtejustify">Abdul Qayyum Chowdhury, president at Real Estate and Housing Association of Bangladesh, Chattogram, said, "The demand for quality housing is increasing in adjoining districts and upazilas of Chattogram. There is also a demand for living close to nature in hilly areas."</p> <p class="rtejustify">Mainul Hossain Moin, president at Cox's Bazar Real Estate Businessmen's Association, said many people want to live peacefully beside the sea beach and hilly areas of Cox's Bazar. "In the last 10 years, housing projects involving around Tk4,000 crore have been set up in the Cox's Bazar area."</p> <p class="rtejustify">The Kuakata sea beach in Barisal is also witnessing a surge in housing projects as Tk2,500 crore has been invested by 30 companies in the last 10 years, said Imrul Hasan Emon, president at Kuakata Housing Business Association.</p> <p class="rtejustify"><strong>Rising costs of construction materials dampen growth</strong> <p class="rtejustify">Work on most housing projects in rural areas has been halted owing to an increase in raw material prices. The prices of rod, cement, bricks, sand and stones have increased by 35%-40% under the impact of the Russia-Ukraine war that began on 24 February.</p> <p class="rtejustify">The market price of rod is now around Tk95,000-Tk97,000 per tonne. The prices of other materials have also increased. As a result, most of the projects remain suspended. Only a few projects are running, which have raw materials bought before 24 February, said Shafiul Alam Chowdhury Nadel, president of SAREG.</p> <p class="rtejustify">Prices of flats are also increasing due to rising construction costs.</p> <p class="rtejustify">Mainul Hossain Moin, president at Cox's Bazar Real Estate Businessmen's Association, said, "The flats in Cox's Bazar area have seen a sharp price hike in early March. The price per square foot flat has increased to Tk6,500-Tk7,000 from Tk5,000-Tk6,000. </p> <p class="rtejustify">Apart from Dhaka and Chattogram, prices in Rajshahi, Bogura, Rangpur, Cumilla, Mymensingh, Khulna, Barisal and other parts of the country also increased by Tk700 to Tk1,200 per square foot in March, local real estate traders say.</p> <p class="rtejustify">Shafiul Alam Chowdhury Nadel said prices of flats in Sylhet are a little higher than in other parts of the country as most buyers in this area are expatriates. </p> <p class="rtejustify">"Before March last year, the price per square foot was Tk6,000 to Tk15,000 depending on the location. But the price rose by Tk1,500-Tk2,500 per square foot in March this year."</p> <p class="rtejustify">About 4,000 housing companies are currently active in the country and of them 1,200 are Real Estate & Housing Association of Bangladesh (REHAB) members.</p> <p class="rtejustify">Alamgir Shamsul Alamin (Kajal), president at REHAB, said, "It is mandatory for every housing company to be a member of REHAB. But many companies are doing business with trade licences from city corporations and municipalities in different areas of the country. As a result, REHAB cannot take any action against any such company for any kinds of misconduct with customers."</p> <p class="rtejustify"><strong>Easy bank loans can boost investment</strong></p> <p class="rtejustify">Entrepreneurs say easy bank loans and government policy support can boost investments in this rising housing sector.</p> <p class="rtejustify">Naimul Hasan, director of REHAB, said, "The interest of home loans is around 14%, but it is 4%-6% in other countries. There are also many complexities in getting loans." </p> <p class="rtejustify">He said the scope of this sector can be further expanded in cities and rural areas with easier bank loans.</p> <p class="rtejustify">Economist Ahsan H Mansur told The Business Standard that the amount of investment in the real estate sector is more than in the garment industry. In terms of domestic investment, it is the number one sector.</p> <p class="rtejustify">"The real estate industry makes a significant contribution to the economy all over the world. The more housing projects come on the market, the more the country's economy grows and new jobs are created. Besides, it helps around 300 linkage industries, including rod, cement, tiles, paints, aluminium, furniture, electric, brick, sand, and stone, and plays a leading role in government's revenue collection," he said.</p> <p class="rtejustify">Around one-third of buyers are expatriates. As a result, the country is earning between Tk8,000 crore and Tk10,000 crore of foreign exchange through this sector, which is eventually adding to the country's forex reserves."</p> <p class="rtejustify"><strong>Legal complexities</strong></p> <p class="rtejustify">Urban Planner Iqbal Habib said the laws and policies are flawed for the real estate sector. </p> <p class="rtejustify">"For example, if a person is cheated after buying a plot, there is a provision to go to the court but there is no government regulatory body in this regard," he noted.</p> <p class="rtejustify">Again, the aggrieved buyer cannot file a case; rather, he has to make a complaint in the arbitral tribunal where the legal process is quite complex. There must be a provision to file a case directly, he added.</p> <p class="rtejustify">Iqbal Habib also said although there is a law to protect the environment or agricultural land from illegal projects, it is not enforced.</p> <p class="rtejustify">He further said, "The fee for registration after purchase of plots or flats is higher in Bangladesh than in other countries. It must be reduced."</p> <p class="rtejustify">Md Shahid Ullah Khandaker, secretary to the Ministry of Housing and Public Works, told TBS that the housing business in towns and rural areas is growing as a result of urbanisation, and the government has also taken various steps to promote this business. </p> <p class="rtejustify">"The ministry has a monitoring team to ensure that housing companies in the city corporation and municipal areas can do business with ease. The ministry has also directed the local administration to take strict measures to ensure that no customer is deceived," he said.</p> <p class="rtejustify">The way the housing business is growing in rural areas, it will play an important role in boosting the economy, he added.</p> </div> <div class="mb-20 text-center hide-for-print"> <div id="dfp-ad-tbs_lb_snd_newsend-wrapper" class="dfp-tag-wrapper">  <pubguru data-pg-ad='TBS-LB-SND-NewsEnd'></pubguru> </div> </div> <div class="related-topic hide-for-print"> <h4 class="margin-bottom-0"><a href="/economy">Economy</a> / <a href="/top-news">Top News</a></h4> <p><a href="/tags/real-estate">Real Estate</a> / <a href="/tags/urbanisation">urbanisation</a> / <a href="/tags/investment-housing">investment in housing</a></p> </div> <div class="mb-20 text-center hide-for-print"> <div id="dfp-ad-tbs_lb_snd_newsend2-wrapper" class="dfp-tag-wrapper">  <pubguru data-pg-ad='TBS-LB-SND-newsend2'></pubguru> </div> </div> </article> </div> </div> <div class="panel-separator"></div><div class="panel-pane pane-custom pane-3 hide-for-print no-title block" class="panel-pane pane-custom pane-3 hide-for-print no-title block"> <div class="pane-content"> <div class="margin-vertical-1 strip-bg-white padding-1"> <h3 class="widget-title bar-red color-red text-uppercase margin-bottom-1">Comments</h3> <p>While most comments will be posted if they are on-topic and not abusive, moderation decisions are subjective. 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