Hyderabad: Swanky cars on the narrow, dusty bylanes, the lingering fragrance of high-end perfume in the air and the rush of the flashy and the flamboyant all day – Tullur, the nondescript village in Guntur district, is relishing its brush with riches.
The cow dung pasted walls are still there as are the overflowing drains, but these would soon be past. The Andhra government’s decision to locate its new capital around this village, also a mandal headquarters, has brought a sudden change in the economy of the area, and a corresponding shift in lifestyle.
The rich and the influential have started descending on Tullur and villages around it, offering wads of currency to the locals in exchange for huge tracts of land. An acre in Tullur and surrounding villages like Pedaparimi that used to cost around Rs 5 lakh to Rs 15 lakh depending on whether it's dry land or wet land is now costing a bomb. The moment Chief Minister N Chandrababu Naidu came up with map of the State Capital Region, the prices skyrocketed. The base price soared by 10 times from Rs 5 lakh to Rs 50 lakh an acre and the highest price offered to a piece of land was Rs 1.60 crore an acre at Rayapudi on the banks of the Krishna.
And it is not only land owners who are making a killing. Everyone, from rural medical practitioners, to auto-rickshaw drivers, to daily wage-earners who used to go to Guntur every day to eke out a living, has turned a real estate broker, negotiating deals with land sharks on behalf of the farmers. An auto-rickshaw driver made Rs 5 lakh in just one transaction on a single day. Real estate businessmen and brokers are having a field day.
The most interesting part is that about five currency counting machines were brought to the village and the lenders are charging Rs 1,000 for counting cash of Rs 1 crore. Due to the huge difference between the registration value and the actual price of the land, most transactions take place in cash.
As for the farmers, they have got rid of their long-term burgeoning debts and settled down in life. For instance, a farmer of Kondrajupalem who begged a landlord to buy his piece of 1.25-acre land for Rs 7 lakh four years ago, failed and had to give up tilling to become a farm labourer to make ends meet, has sold his land for Rs 1 crore. He has invested Rs 65 lakh in Palnadu area under Nagarjuna Sagar Right Canal at Rs 20-odd lakhs an acre, cleared his debts and now is planning to get the best education for his children. There are many such people who are becoming rich overnight.
For the real estate buyer, the benefit is much higher. The state promised 1,000 sq. yards of residential land in lieu of each acre of land taken as part of land pooling. At some places, they are expecting that the extent of the alternative developed land, given in lieu of the agricultural land, would be 1,200 sq. yards. If the gestation period for the development is four years, the real estate companies are expecting a return of Rs 20,000 a square yard at barest minimum, thanks to the establishment of the new capital.
If that is the case, 1,200 sq. yards would fetch Rs. 2.40 crore. If the land was bought at Rs 80 lakh and acre, the RoI (return on investment) would be four times in four years. For the land bought at a higher cost, the RoI may not be akin to hitting upon a gold mine, but definitely not a bad proposition. The average going price an acre is ranging from Rs 70 lakh to Rs 90 lakh.
Those buying outside the map of the land earmarked for capital city are the 'vanguards' of possible businesses including star hotels. The splurge by realtors isn't any less in other districts of Andhra Pradesh, but with a degree of difference. The June-October period in 2014 fetched Rs 1,469.95 crore towards registration charges as opposed Rs 624.83 crore in the year ago period in the 13 districts together.
The highest registration amount was Rs 236 crore from Krishna district where transactions soared from 44,281 to 91,215. The highest number of registrations happened in Guntur district -- 99,310 -- in the last five months fetching a revenue of Rs 202.59 crore to the government.
The highlight in the region ear-marked for the new capital is that car dealers and banks have set up kiosks to lure the farmers to buy cars. Rahim, sales executive of Nissan Cars, said he had sold 10 cars in just 10 days. Ramu, sales executive of Maruti Suzuki, said he had sold 27 in three weeks. ICICI, HDFC and LIC established their kiosks with their executives educating the farmers on how to secure their unexpected riches through investments