Operators lament building materials price hike

<p>Operators in the real estate sector have said the hike in prices of cement and other building materials may trigger a drop in building standards of houses.</p>, <p>Industry chiefs in separate interviews with our correspondent noted that the recent price hike of building materials would increase costs of production, reduce the company’s profits and affect the viability of the sector’s value chain.</p>, <p>The Managing Director and Chief Executive Officer at Fame Oyster & Co. Nigeria, Femi Oyedele, told The PUNCH that the surge in the prices of building materials might force project owners to review contract conditions.</p>, <p>He said, “Definitely, contractors who have started building projects will be going back to their clients (project owners) to review the contract terms. The increase in the price of cement will affect the conditions (price and rate of completion) of building projects. It will also affect the demand for building products as the increase in prices of cement will affect prices of houses.”</p>, <p>Similarly, the Chief Executive Officer of Seven30 Real Estate Limited, Oluwole Fapohunda, said firms would have to factor in the increase to arrive at their cost of production, which in turn would affect the sales price.</p>, <p>Oluwole emphasised the crucial role of cement in the construction industry, highlighting that builders might have to compromise on the quality of materials if homebuyers are unwilling to pay higher prices for houses.</p>, <p>“One of the things we have to understand now is that to have quality, customers have to be ready to pay for more, but if buyers are not ready to pay more, it means that the developer may be forced to reduce the quantity used during construction, which will not end well, because there is an adequate ratio of cement that needs to go into the construction process.</p>, <p>“Another implication is that developers that cannot stand their ground on quality may be forced to lower the standard, which may eventually result in more building collapses.”</p>, <p>He fu