Ahmedabad Housing Market Faces 17% Annual Dip
Ahmedabad’s residential real estate market, which has been witnessing steady growth over the past few years, faced a significant correction in Q4 2024. Despite a marginal 3% increase in new project launches compared to Q4 2023, home sales in the city declined by 10% quarter-on-quarter and 17% year-on-year. Industry experts attribute this slowdown to a combination of factors, including increased supply, rising property prices, and uncertainty surrounding the proposed jantri (ready reckoner) revision in Gujarat. The western region of Ahmedabad remained the top performer, accounting for 34% of total sales, while the northern zone gained momentum, contributing 29% to overall transactions. These figures reflect shifting homebuyer preferences amid economic headwinds and evolving affordability dynamics.
The city’s property market saw robust new launches, with approximately 9,000 new residential units hitting the market in Q4 2024—an annual increase of 16%. North Ahmedabad emerged as the new focal point for residential developments, commanding 37% of total new project launches, surpassing the traditionally dominant West Ahmedabad, which held a 32% share. However, despite the influx of supply, absorption rates have not kept pace, leading to concerns over inventory build-up. Available inventory remained stable at around 62,800 units, but its year-on-year reduction by 11% suggests that market activity is still sustaining momentum. Meanwhile, West and South Ahmedabad experienced a quarterly dip in unsold inventory by 3% and 13%, respectively, while the East and North zones saw a slight increase of 3% each. The rising cost of land, coupled with higher property prices, has notably impacted the mid-segment housing market, making homeownership increasingly challenging for middle-income buyers.
From an urban development perspective, the surge in housing supply amid sluggish sales raises concerns about potential oversupply and unsold inventory. While North Ahmedabad has emerged as a promising real estate hub with an increase in larger 3, 4, and 5 BHK projects, affordability remains a critical challenge. With the impending jantri revision expected to push property prices further, the accessibility of mid-segment housing could be further strained. Experts suggest that a balanced approach is required, ensuring that the city’s infrastructure keeps pace with its expanding residential landscape. At the same time, high property costs could deter first-time homebuyers, shifting the demand towards rental housing. The real estate sector’s ability to adapt to these changing dynamics will be crucial in maintaining market stability and ensuring sustainable urban growth.
Sustainability remains an essential factor in Ahmedabad’s evolving real estate landscape. The increasing number of new residential launches highlights the need for developers to integrate eco-friendly construction practices and green building certifications to align with global sustainability trends. With climate change concerns and rapid urbanisation, prioritising energy-efficient designs, rainwater harvesting, and smart housing solutions will be imperative. While luxury and mid-segment housing continue to expand, future growth must consider environmental responsibility to mitigate long-term ecological risks. As Ahmedabad’s residential sector navigates price pressures and policy changes, a sustainable, well-planned approach will be key to fostering a resilient and inclusive housing market.
