Land prices in Prithvihar, Coimbatore, Kollam and Coimbeto have risen by as much as 10 per cent in the last six years, according to a report by the Land and Environment Policy Research Centre.
The report, released on Thursday, said the land market in these towns and cities is not sustainable.
It said the average house price in the area increased by 12 per cent from April 2017 to June 2018, while the average income rose by 3 per cent.
“There has been an oversupply of houses at an unsustainable level for six years.
This is a result of over-supply and over-valuation of land,” said Suresh Sharma, who chaired the report.
The land market is a highly sensitive issue in Prindvi Land, a rural township in the eastern part of Coimratore.
A recent government order for the state government to allocate 5,000 acres of land in Coimat to development projects has triggered a rush to get rid of existing houses and build houses on top of them.
The government also wants to build two more high-rise apartments in the village.
The Prithvidhi land project will be built on the site of a former sugarcane mill.
It has the potential to create employment in the region, said Seshish Sharma, a professor of urban planning at Coimataria University.
However, land prices in Coimbra are still a fraction of those in other areas of the state, which have higher prices due to the fact that the state is dependent on sugarcanes for its livelihood.
The Kollams are home to about 50 per cent of the total number of Prithviras, while Coimrats will see a big increase in the number of new houses.
The study said the impact of the land rush will be felt in Kollama, Coimbratore and Coimbramar.
“This is a serious issue for rural communities.
The land rush is not helping them to maintain their villages, which are very poor,” said Rakesh Patel, a retired teacher who is currently working in Kallipur.
He added that many rural areas are now underdeveloped.
The Land and Environmental Policy Research Center said the increase in land prices is due to “increases in land availability”.
However, it added that land prices were also affected by land scarcity.
“It is difficult to build new houses on the land.
In Coimbramar, only one building has been constructed on the Prithivihar land,” it said.
The State Planning Commission said that the report does not include information on the impact on the local economy and that the impact would be measured through data collected by the government.