Gujarat's Real Estate Market Struggles with 89% Unsold Inventory
Gujarat’s real estate market is struggling to bounce back to pre-Covid levels in 2024-25. Project completion rates have plunged to a mere 2% year-on-year, while 89% of inventory sits unsold.
Gujarat RERA’s latest report paints a grim picture. Only 36 projects reached completion compared to 1,981 in 2017-18, marking a steady decline over seven years.
The completion rate has fallen off a cliff. From a healthy 90% in 2017-18, it slipped to 82% in 2018-19 and 80% in 2019-20. The downward trend continued with 74% in 2020-21 and 56% in 2021-22. Things took a sharp turn for the worse at 27% in 2022-23, before crashing to 10% in 2023-24.
Project numbers have plummeted. The total number of completed projects registered with the authority has nose-dived. From 1,981 in 2017-18, it briefly rose to 2,409 in 2018-19 before falling to 1,380 in 2019-20. The decline persisted with 983 in 2020-21, 946 in 2021-22, 499 in 2022-23, and just 166 in 2023-24. GujRERA data also reveals a drop in overall project cost over seven years. Investments fell from Rs 83,963 crore in 2017-18 to Rs 78,944 crore in 2024-25. The total number of units in these projects shrank from over 3.23 lakh to about 1.99 lakh units in the same period.
Project costs primarily comprise construction and land components. Construction costs decreased from Rs 62,828 crore to Rs 58,663 crore between 2017-18 and 2024-25. Land costs also dipped from Rs 21,135 crore to Rs 20,281 crore. Total carpet area contracted from 20% to 12% during this period.
A staggering 89% of inventory remained unsold in 2024-25. Back in 2017-18, of the 3.23 lakh registered units, over 2.29 lakh (70%) were sold, leaving around 94,000 units (30%) without buyers. The situation has flipped dramatically. In 2024-25, out of roughly 1.99 lakh units, only about 22,000 (11%) found takers, while around 1.77 lakh units (89%) languished unsold.
When contacted, Nilay Patel, CREDAI Secretary, pointed to staffing issues. “The lesser number of realty projects completion could be due to non-availability of the labourers as one of the reasons. As far as unsold inventories are concerned, it may be due to the rising demand for ready-to-move-in properties by the property buyers.”
He added: “We are also facing the same issue in our residential projects as non-availability of the labourers has delayed our projects.”
