Plotted schemes 25% cheaper as stalemate over 68 villages continues

Ahmedabad Urban Development Authority’s (Auda) decision to restrict development in 68 villages, which fall under its purview, has landed a big blow to the plotted development schemes in these areas. For, such properties have started witnessing as much as 25% downward correction in their prices. If the state government does provide any relaxation soon, their prices may slide even further, say realtors who are already a worried lot.

Thousands of people from the middle-income group (MIG) have already invested money in hundreds of plotted development schemes in villages including Ghuma, Shela, Rancharda, Kaneti, Thol, Mulsana as well as areas surrounding Nal Sarovar.

For most of them, the purpose of investing in these schemes was to get good returns as the land prices suited their affordability criteria. However, now, Auda has denied construction in these areas by declaring them to be under the agriculture zone. Stalling of the schemes’ development there has thus resulted in the negative price correction, which has kept the market in limbo for close to a decade.

According to real estate consultant from Bopal, Paresh Ramawat, the market has been passing through a negative phase for quite some time, and the ban on the construction of these schemes has only added to the woes for the developers as also their investors.

Ramawat said that a developer, who used to quote around Rs9,000 per square yard for a land parcel in Manipur area, has now started quoting as low as Rs7,000 per square yard.

The stakeholders had submitted their objections against the declaration of agriculture zone in 68 villages and against allowing development in just a 100-metre radius of the village settlement. However, the authorities did not pay any heed to these objections.

“Property prices in plotted development schemes have gone down in the region of 25%. Now, all eyes are on the state government; unless it provides some relief, the situation is unlikely to get any better,” said Prakash Bavadiya, chief executive officer of real estate consultancy firm, City Estate Management.

Even properties that fall outside Auda limits have not been able to garner a good response from either end-users or investors.

“We have a plotted development scheme near Sanand, which falls outside Auda limits. Since the area is not part of the restricted land, we had believed it would do really well. However, even the response there is not at par with our expectations at all,” said a leading developer from the city.