Despite tapered demand for homes due to the Covid-19 pandemic, the prices of residential properties are on the rise in Gujarat including the residential spaces being built in GIFT City, in the state capital Gandhinagar.
In Ahmedabad, one of the biggest property markets of the state, the prices of homes are expected to shoot up by 30 per cent in the next four months, say experts from the real-estate sector. A steep jump in construction raw material has led to an increase in construction costs, which real-estate developers may pass on to the buyers.
Sanket Shah, a real-estate developer and honorary secretary of GIHED-CREDAI, a city-based body of developers, said prices of housing projects that are commencing are expected to rise by 30 per cent. “Since May 2021, some of the developers have already increased the prices by 10-15 percent,” said Shah.
According to GIHED, most of the developers will increase the prices in a staggered manner as the market has slowed down due to the Covid-19 pandemic. “Any sudden rise in prices will shoo away the buyers from the market, where the demand is already less. But eventually, the prices will increase as the rise in prices of construction materials like cement and steel have thinned our margins,” he added.
Sangath IPL which is building 150 residential units in GIFT City in the first phase said the prices of under construction homes have already gone up by 10 per cent. “There is a 60 percent increase in input costs after the prices of steel went through the roof. Even the price of glass costs 40 percent more. This has forced us to increase our prices by 10 per cent for now,” said Sanjay Jain from Sangath group which is building two bedroom-hall-kitchen housing units.
Jain said, “In the past two months, we did not get a single booking. But with the Covid situation easing, we expect some business.” The impact of price rise is expected to be in residential projects that are at launch phase or at initial stages of construction, Shah added.
A real-estate consultant, on condition of anonymity, said that the prices of housing projects in cities like Rajkot and Surat have more or less remained stagnant due to the poor demand, while those in Ahmedabad and Gandhinagar have seen a rise.
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