Gujarat housing market showcased a steady and strong progression even during the pandemic years and continues to perform better than many other cities. Anup Shah Head – Transactions Ahmedabad, JLL remarked, “The increase in residential sales during the pandemic and till date is absolutely connected to the government incentives that revived the market sentiment. Moreover, with the drastic shift in the buying pattern for bigger homes, the housing segment has witnessed an upward trajectory.”
Sharvil Shridhar, Group Co-Founder, A. Shridhar Group averred that the rising urbanisation and the psychology behind home ownership has driven sales for residential units in the preceding two years. “The pertinent questions today is whether affordable housing is still affordable? Construction is not getting any cheaper, this is why we are seeing a considerable decline in new affordable project launches from reputed developers. However, a loyal base of end consumers is keeping the gusto alive for development projects with upgraded demands, thus fuelling the mid-income and luxury housing.
Ishan Patel, Director, Branding & Communication, Suryam Developers talking about second homes said, “A desire for a sanctuary away from the city’s hustle has invigorated home buyers to shift their focus towards satellite towns. Pandemic induced emotions have triggered the change in behavioral patterns. Distance is no more a concern because of better connectivity and road infrastructure.”
Anand Choksi, Chairman and Managing Director, The Real Estate CONNECT shared his views, “With the FSI rates shooting up, land prices not declining, and the unmoved price of the finished product, a Catch- 22 situation is affecting the developers. In spite of the challenges, Gujarat housing in general has seen a drastic rise in sales post pandemic.”
Tarun Varma, Co-Founder Partner Swagat Group added, “The twin cities of Ahmedabad and Gandhinagar are witnessing a realty boom and the heightened investor interest is clearly an indicator of a strong future for Gujarat realty. There has also been a hike in the property prices, but the impact has been minimal on consumer interest.”
According to Deep Vadodaria. CEO, Nila spaces Limited, GIFT will remain an attractive investment destination for years to come. “GIFT is a world city. Infrastructural advancement, accelerated employment opportunities and availability of amenities are legit reasons for people to consider for higher returns on investments.”
CURRENT MARKET SENTIMENTS
According to Tarun Varma the home loan interest rate impacts the initial stages of realty sales and may not have a prolonged negative impact on sales. Also, buyer’s choice has changed from bungalows to high rises in Gujarat.”
Sharvil Shridhar was of the view, “A reduction in home loan interest rates should be considered to benefit affordable and mid-income housing buyers. Taller buildings need a higher construction budget, additional floor space index and rationally longer deadlines. There is a demand for height and we wish to build a new skyline for our cities.”
Ishan Patel shared, “There is an oversupply of high rises in Ahmedabad due to fierce competition. Construction timelines are definitely higher so part possessions are a solution. Also, easy loan approvals will encourage home buyers to invest in property.”
Deep Vadodaria opined, “We have observed that the first time home buyers are less sensitive to interest rates and their decisions are rather affected by other vital factors. Furthermore, there is an obvious fascination for heights today. Construction of taller structures can take four to five years and consumers have to get used to such timelines.”
Anand Choksi explained, “Interest rates and real estate are inversely proportional. The demand cycle and favorable government policies ensure the well- being of the realty sector in turn supporting all the other sectors. Also, the cityscape of Gujarat is upgrading with the preference for high rises.”
Anup Shah concluded. “Affordability remains high and we do not see any major impact on the demand side in Gujarat housing market. With inflation cooling down, the interest rates too are expected to come down. The new township schemes coming in will further open up more land for development in Gujarat.”
THE EXPERT’S CONCURRED THAT THE RBI'S DECISION TO HIKE THE BENCHMARK INTEREST RATE WILL MAKE HOME LOANS COSTLIER AND DAMPEN THE HOUSING SALES IN AFFORDABLE AND MID-INCOME HOUSING SEGMENT.
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