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The unrelenting gold rush

  • Published at 08:53 pm January 29th, 2020

Between 1988 and 2010, the average price of land in the anterior blocks of Bashundhara increased by over 2400%

Except for only a handful of people, no one could have predicted way back in the 1980s the impact Bashundhara Residential Area would have on the real estate industry and the makeup of Dhaka city as a whole. The modern “Residential real estate” landscape, for better or for worse, has been greatly influenced by the project that used to be known as the Bashundhara Baridhara Land Project. But by the time people finally realized what was going on and how valuable the land in Bashundhara R/A was, it was too late.

The scramble for land in Bashundhara was already in full swing as prices in the project were rising at an unprecedented rate. What began back then continues even today. Land is considered almost an invulnerable investment, and land in Bashundhara R/A is considered by many as good as gold.

The unwavering demand for land is not exclusive to our region though. This phenomenon is as old as human civilization and can be found in every corner of the world — growing and thriving. The last four years, from 2016 to 2019, saw continued growth in the real estate sector of emerging markets — at least 4-5% — according to a recent report by investment firm Morgan Stanley. 

Bangladesh and its capital Dhaka fall under that emerging market category. But as it stands, the land prices in Dhaka sometimes eclipses even that of some major cities in the world. Older and more established areas such as Gulshan, Dhanmondi and Motijheel have reached a different level in terms of property prices. Finding available land to buy in those areas is next to impossible nowadays and even if there is one, a buyer would need to spend on average Tk5 crore for every katha of land. 

In contrast, Bashundhara R/A is a relatively new area — forming fully well into the new millennium. But in just a short few years, the area has carved out a place for itself in Dhaka’s landscape. The price of apartments and land has skyrocketed with some land going for as much as Tk2crore. 

The project itself is immense, bigger than most people realize — about 3,346 acres. Due to its size, the project was divided into four phases — with only phases one and two being more familiar to people, Block A to Block P. However, the Bashundhara project extends all the way to the Balu River and beyond that will comprise an extension of Blocks P, Q and R. Extending the project so far was not in the original plan. But when the project took off, there was no stopping it. 

Between 1988 and 2010, the average price of land in the anterior blocks of Bashundhara increased by over 2400%, from Tk1 lakh to Tk25 lakh. In the next 10 years, that number continued to increase at almost the same pace. As a result, the average price of even the posterior blocks has also increased by leaps and bounds. Today, finding a plot in Blocks J, K or L that is less than Tk50 lakh is difficult to say the least. But the rush for land in Bashundhara has not stopped there. 

The lands available on the extended projects are also being scooped up fast even though almost all of it is yet to be delivered. Within a decade and a half, Bashundhara R/A has established itself as a location where the future will take place. And people are not willing to let go of an opportunity to be part of it. 

The promise of Purbachal New Town on the north is also a great influencing factor in the rise of demand for land in the Bashundhara R/A extension. Purbachal is poised by everyone to become the next big thing in Dhaka. It is only natural other projects would take advantage of it. If everything Purbachal promises is delivered, the entire section of the city will be greatly benefitted — and people know it too. 

So, what do you get when you mix a secure future with a brand that is considered by many as trustworthy? Gold! Which is why even the land available in the extended zones are going at the rate they are. Tk22 lakh to Tk32 lakh — the amount per katha someone would have to spend to acquire a plot in the extended Block P of Bashundhara R/A. And if you want to find land that costs less than Tk20 lakh, you would have to go all the way to the extended Blocks Q and R — which a lot of people are doing. 

In comparison, the average price of land per katha in Dubai is around Tk54 lakh. But why would so many people be willing to spend so much on land that is yet to be ready for even construction? Because of the promise it holds. As mentioned before, land in Bashundhara R/A has increased thousands of percent since its conception, and people are expecting the same trend to continue. As the city continues to expand eastward and connects that part of the capital to the rest of the city, prices can only go up. 

People do not invest in land for an immediate return. They understand that there is a chance that if you invest in land today, the apex of its profit might be attained in 20 years or so. For most residential projects, that is the expected outcome — but Bashundhara is considered something more. 

People believe that the wait would be much less than other projects, mainly for two reasons. First, the project’s track record. They have delivered massive returns within a short span of time. And second, rapid development of the area. These two factors are influencing and convincing people every day to invest in something that might not seem like a lot now, but will be something truly spectacular in the coming days.