In the second quarter of 2024, developers launched 6,194 units in Ahmedabad’s real estate housing market, driving prosperous growth. There is an increase of 5% in new launches of real estate properties at the end of Q3. In the year 2023, property prices in Ahmedabad increased by 0.35%. Over the next five years, there is growth of 10-12% in the real estate market. This is the prediction of industry experts. All of this suggests that the future of Ahmedabad real estate appears bright. Apart from this, this article focuses on the challenges of the real estate landscape in Ahmedabad.
What Are the Challenges of the Real Estate Market in Ahmedabad?
Every coin has two sides. Similarly, the real estate market, particularly in Ahmedabad, is experiencing potential issues. Below are:
Changing Regulation
With the introduction of RERA (Real Estate Regulation and Development Act) in 2016, the real estate market saw significant changes in regulations and laws related to real estate properties. It requires developers to report their projects to regulatory authorities. RERA emphasizes project delivery on time and financial management. The Centre and State play a vital role in governing the real estate sector of Ahmedabad, leading to delays in project approvals and difficulties in business operations. Different states have slight modifications to rules. Furthermore, developers face complications in smooth legal procedures.
Unpredictable Market
Real estate prices fluctuate and Ahmedabad’s real estate landscape is no exception. Therefore, it is difficult to predict the market trend. Market volatility leads to decreased prices and demand in the real estate market, resulting in financial stress for developers.
Affordability
Potential homebuyers get residential spaces at affordable prices. It is possible because of the new construction of residential properties in Ahmedabad. However, it is not beneficial to certain classes. Here’s how it is possible:
Home Loan Rates Are Increasing: When home loan rates increase, it directly impacts the affordability of middle-income homebuyers as they need to pay more EMI amounts.
- Lack of Financial Resources: Financial institutions may have complicated rules for real estate developers. This limits finances and as a result, they can build a single project at once.
- Land Prices Are Rising: Land prices are increasing with time, which impacts new property construction. It is a potential challenge for real estate developers in Ahmedabad.
Land Acquisition Issues
Legal procedures are involved in the land possession. Land acquisition issues include documentation of land ownership, title clearance disputes, and delays in satisfying the legal process, leading to rising project expenses.
Mismatch of Infrastructure Supply
There is an interconnectedness between the city’s expansion and development. However, this progress often overlooks the needs of developing suburban areas, which struggle with inadequate infrastructure, particularly the lack of metro connectivity. With the pace of expansion, the city’s infrastructure, like transportation, basic utilities, and civic amenities, has not matched the development pace, particularly in the rapidly developing suburbs.
Lack of Transaction Transparency
Buyers must be aware of each documentation process while buying any properties. However, some real estate developers follow malpractices and the absence of clear and accessible transaction records can create uncertainty and trust issues, deterring potential investors and buyers from entering the market.
These challenges are hindrances for developers, buyers, and investors. Addressing these issues attracts buyers and investors and contributes to a brighter future for Ahmedabad’s real estate market. Additionally, it helps make informed decisions and ensures market resilience. When considering investing in residential or commercial properties in Ahmedabad, contact D&C real estate developers, as they can help you with every legal aspect of the purchase.
In addition, if you want to buy luxurious bungalows, their Apricity residential project is worth considering. Visit their website or download the brochure to explore its high-end amenities.
