With home loans getting costlier and realty market in a state of slump consumer focus is now slowly shifting back to 'resale properties' in Ahmedabad. Amidst rising realty prices, the latter have been appearing 'greener pastures' for buyers lately.
"Buyers who want more carpet area and want to stay within city limits are opting to go for resale properties. With property prices at an all time high now, the market is seeing a slump since eight months and there is only 2-5 per cent buyers of the luxury home segment. People are choosing to buy as they know that there is no further correction that is likely to happen and Ahmedabad realty is still affordable compared to other cities," says Hitesh Shah, chief executive officer - residential properties at Space Management Ltd, a city-based real estate consulting firm.
Apparently, as per a Cushman and Wakefield research approximately 33,000 units across various segments are expected to come up by end of 2013 in the city. But to move into many of these affordable homes, buyers are now having to go to alternative areas such as Gota, New Ranip, Makarba and Shela in western Ahmedabad or New Maninagar, Vastral and Nava Naroda in the eastern part of Ahmedabad. Larger carpet area and ready possession seem to be the selling point for resale properties as also the competitiveness of the market that offers upto 15 per cent discounts based on the condition of the home.
"There is definitely a trend towards buying resale property in Ahmedabad as it is a very competitive market. With older buildings one gets an advantage of 'super built-up' which means that in newer properties you will be paying for 100 carpet area but getting only 60 percent whereas in a resale property it would be as 80 per cent. Apart from 15-16 per cent discounts, buyers get ready possession and clear papers thereby ensuring that the banks be ready to shell out upto 85 per cent loans," says Nirav Kothari, regional director (Gujarat), Jones Lang LaSalle India (JLL), a global property consultant.
However, on a flip side, the usable area is higher, the amenities might not be on par with some of the newer housing scheme, says Kothary. "However, sellers can give up to 20 per cent discounts depending on the condition of the apartment. But a lot still remains to be done in the property management and parking amenities in Ahmedabad," he adds. Meanwhile, the gap between the payment and actual possession of the home in a resale property is also another reason why many buyers are opting for resale properties. "There has been a 10-15 per cent correction in the residential properties market and while newer schemes are not in a position to offer discounts, resale properties have moved into cash in on the phenomenon. Most of the newer constructions are still in the production phase and depending on the fortunes of the market, the possession to the buyer delays by one or two years. In such a scenario, this is the right time to invest in resale properties," says G D Agrawal, director of GD infrastructure.
The newer properties have mostly attracted investors, say developers. " But yes coming to the 2BHK category as the prices have moved up, resale properties are getting more popular as they are more affordable. As most of the newer housing schemes are on the outskirts, there is a segment who prefer living in the city limits and this is definitely opting for resale properties," says Jateen Gupta, MD of JP infrastructure Ltd.
