Ahmedabad Real Estate Market: Slump or Boom? Builders Dispute RERA Report

Gujarat’s real estate market, especially in Ahmedabad, is showing signs of slowdown, according to the 2024–25 annual report by Gujarat RERA (Real Estate Regulatory Authority). The report reveals that nearly 1.77 lakh out of 1.99 lakh new flats remain unsold. Despite this, several builders on the ground claim the market is healthy and booming, especially in the affordable housing sector. Bhaskar’s team visited various areas in Ahmedabad and spoke to multiple developers to understand the real situation.

RERA report indicates recession

Gujarat RERA’s latest report points to a long-term recession in the state’s housing market. The number of newly built residential units has dropped from 3.23 lakh in 2017–18 to 1.99 lakh in 2024–25. Investment in the sector has also reduced from Rs 83,963 crore to Rs 78,944 crore in the same period. Project completion rates are slowing down, with a 2% annual decline. Despite this, property prices continue to rise—causing confusion between the actual market condition and the rising cost of homes.

Builders deny slowdown, call report flawed

Nilay Patel, Director of Deep Builders and Secretary of CREDAI Ahmedabad, disputes the RERA data. He says RERA does not release detailed project-wise sale data publicly and questions the accuracy of the unsold inventory numbers. According to him, all ongoing projects under his company are selling well, especially 2BHK and 3BHK apartments priced affordably. He states that local buyers, as well as people from nearby villages, are actively purchasing homes.

House prices are rising, but so is demand

Nilay Patel attributes rising prices to increased land costs and higher prices of construction materials. However, he insists people’s income levels are also growing, which supports demand. He argues that flats in newly registered projects naturally take time to sell and that high unsold inventory figures could be misleading. He also points to events like the potential 2036 Olympics in Ahmedabad as boosting confidence in the market.

Affordable housing still in high demand

Ankur Desai, founder of Sanvi Construction, shares similar views. He highlights that under the affordable housing scheme introduced in 2013–14, areas around Ahmedabad’s ring road were developed with smaller, reasonably priced homes. Desai’s company shifted its focus from luxury flats to affordable housing, building flats under Rs 80 lakhs, which continue to sell well. He says proper planning and segment targeting ensure success.

Pricing strategy and location key to sales

Sanvi Construction’s success lies in choosing land where affordable homes can be built. The company now builds in areas like Chandlodia and Vasna, offering flats under Rs 65 lakhs. Installment options ranging from Rs 20,000 to Rs 50,000 a month make these homes accessible to the middle class. Desai says demand is strong in areas like Shela, Science City, and Linking Road, where infrastructure is improving and commute times are manageable.

East vs West Ahmedabad: A split market

Hardik Patel of Anantara project in East Ahmedabad notes that most homes in his area are sold before project completion. He says that areas like Nikol, Vastral, and New Maninagar have high demand and cannot be compared with investment-heavy West Ahmedabad. In West Ahmedabad, investors often buy flats early in projects and sell them later for profit. This delays real sales and may contribute to higher unsold inventory figures in the west.

Rising costs blamed on land and labour

Across Ahmedabad, builders agree that land prices are the biggest driver of rising home prices. Construction materials like steel, cement, tiles, and even doors have become more expensive. Labour costs are now even higher than material costs, due to shortages and lack of skilled workers. Builders are asking the government for relief on fees and stamp duty to keep prices in check for affordable housing.

Ahmedabad still offers budget homes

Despite the challenges, Ahmedabad remains one of the fastest-growing cities in India, with a strong demand for affordable housing. The city’s strategic location and growing infrastructure continue to attract both buyers and investors, ensuring that the market remains robust in the long term.