Ahmedabad's Real Estate Slump Affects Redevelopment Deals
The slowdown in the real estate market has significantly impacted redevelopment activity in Ahmedabad, leading to a sharp decline in new deals and an increase in unsold inventory.
Real EstateRedevelopmentAhmedabadUnsold InventoryMarket SlowdownReal Estate NewsNov 21, 2025
According to the Urban Redevelopment Housing Society Welfare Association, Ahmedabad saw only around 20 MoUs for redevelopment in the past six months, compared to 80 MoUs in the first four months of the calendar year. Industry estimates show that nearly 150 redevelopment projects have been completed so far in the city. However, many of those finished over the past 18 months are still carrying around 25% unsold stock, a trend that has made builders hesitant to take on new projects.
"Overall, real estate is passing through a sluggish period and it has impacted redevelopment projects as well," said Jitendra Shah, president of the association. "Only 20–25 new redevelopment deals have been finalised in the last six months. Despite strong momentum last financial year and a fast start in 2025, the slowdown has hit fresh activity. Unsold inventory of 20–25% in recently completed projects has directly impacted developers' margins."
In redevelopment projects, the number of new units is higher than the original houses. The old residents receive new units, and the remaining flats are sold on the open market. With demand weakening, many developers are unable to liquidate this surplus inventory, affecting cash flow and profitability. "Because of this, several builders are refraining from signing new redevelopment deals. In some cases, MoUs have been signed, but demolition or construction has not yet begun, causing anxiety among residents," Shah added.
Despite the slump, stakeholders believe sentiment is set to improve. Shah noted that residents today are far more open to redevelopment than they were a few years ago, helping quicken processes. Jigar Bharwad, a builder involved in society redevelopment, said the "conversion ratio has improved as both residents and developers now have a clearer understanding of benefits and returns." Improved infrastructure and transport connectivity, he said, will drive more redevelopment in central areas.
Developer Kartik Soni added that localities such as Naranpura, Navrangpura, Paldi, and Vasna are seeing increased supply from redevelopment. "New buyers now have multiple options, and developers with stronger brands and better amenities are selling faster than others," he said.
Frequently Asked Questions
What is the current state of the real estate market in Ahmedabad?
The real estate market in Ahmedabad is currently experiencing a slowdown, which has led to a significant decrease in new redevelopment deals and an increase in unsold inventory.
How many new redevelopment deals have been signed in the past six months?
Only around 20 new Memorandums of Understanding (MoUs) for redevelopment have been signed in Ahmedabad in the past six months, compared to 80 MoUs in the first four months of the year.
What is the impact of unsold inventory on developers?
The unsold inventory of 20-25% in recently completed redevelopment projects has directly impacted developers' margins and cash flow, making them hesitant to take on new projects.
Which areas in Ahmedabad are seeing increased supply from redevelopment?
Localities such as Naranpura, Navrangpura, Paldi, and Vasna are seeing increased supply from redevelopment projects.
What factors are expected to improve the sentiment in the redevelopment market?
Improved infrastructure, better transport connectivity, and a clearer understanding of the benefits and returns by both residents and developers are expected to improve the sentiment in the redevelopment market.
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