As many as 71,749 affordable homes are currently being built, with more than half being 2 BHK dwellings. These will be ready over the next two or three years.
After having declined steadily for three years in a row, availability of affordable homes – mainly 2BHK units – in Ahmedabad city is set to surge. As many as 71,749 affordable homes are currently being built, with more than half being 2 BHK dwellings. These will be ready over the next two or three years.
Figures from the Ahmedabad Municipal Corporation (AMC) suggest that 35,826 units with carpet areas between 50 and 66 square meters (538 sq feet to 710 sq feet), and 7,237 units with carpet areas ranging from 66 sq m to 80 sq m (710 sq feet to 861 sq feet) are under construction. The number of units smaller than these, with carpet areas of up to 50 sq m – is 24,198. These units have been approved by the municipal corporation over the last three and a half years and are at various stages of development will awaiting building use (BU) permission.
Most of these units are in areas like Lambha, Vatva, Nikol, Vastral, Vatva and Odhav in the east and Gota, Ghatlodia and Makarba in the west. Over the last few months, proposals for affordable housing schemes have begun to decline, AMC sources said.
CREDAI national president Jaxay Shah said, “These are encouraging signs that affordable housing is picking up, but I feel we are still short of the target. With Ahmedabad’s population and migration, we need at least 80,000 2BHK units supply. Right now it is exactly half that number.”Of the units under construction, 67,301 are being built by private builders while 4,448 units are being constructed jointly by the government and private developers.
“Development control regulations earlier provided a 10% exemption on FSI, which has been reduced to 8% and now the government has included the gallery area of apartments in the FSI. These amendments have made affordable housing schemes less attractive to builders,” a senior AMC official said.
There has been no sudden jump in housing construction though. The new supply seems to be projects that were stuck over the last three years following demonetisation, implementation of the new realty law RERA, and goods and services tax (GST).
Migration to the online development permission system (ODPS) also held up several projects in Gujarat. Building plan permissions started getting through only after the manual system of approval was temporarily re-introduced. The real estate sector has been reeling from a slowdown, with sales and new project launches hit hard in the last three years.
According to the real estate consultancy Knight Frank India, launches of new residential units declined by 10% from 15,553 in 2015 to 14,009 in 2016. Launches slumped by 66% to 4,790 units in 2017 and by 13%, to a one-decade low of 4,167, in 2018. The impact of DeMo, RERA and GST was felt severely in 2017.
Not just launches, even sales have eased. Residential unit sales came down to 15,956 in 2016 and 15,741 in 2017. Sales improved to 16,188 units in 2018.
The fewer-than-usual launches helped realtors clear unsold inventory. With sales remaining four times the new supply, unsold inventory of housing units has come down by 45% from 26,884 in 2017 to 14,863 by the end of December 2018.
Despite prices remaining stable in Ahmedabad, realtors complain that property prices in Ahmedabad have not increased in tandem with higher land, construction and finance costs.