The residential rental market in Ahmedabad, after escalating to almost 100 per cent in the past three years, is witnessing a slowdown for the past few months. Though the plot values have been increasing across Ahmedabad but decrease in rentals are resulting in discouragement among the investors to hold on to their properties for long.
With supply of monotonous properties the rental market of the city is experiencing a downfall. According to industry sources, this fall in residential rental values in Ahmedabad is expected to continue for some more time. However, the housing demand in the city is consistent, affirm Ahmedabad real estate agents.
But all this is leading to disinterest among the investor class in Ahmedabad properties. Investors form a major group of people in the real estate industry who park big time money in various new projects. So, when rental market experiences a bad phase it hampers the potential return on investment.
The people who have already invested in Ahmedabad Properties are now feeling a cash crunch. This is making the potential investor apprehensive of investing in Ahmedabad properties. Also the real estate developers are anxious to launch new projects in Ahmedabad and those who already have their projects at different stages of construction in the city are waiting for the rental market to get back its pace.
Further, the real estate developers who have their residential projects in suburban areas of Ahmedabad are finding no takers. These projects are mainly NRI centric, who invest in such projects and then rent them out to catch regular returns. Nevertheless, the rentals are comparatively low in these areas as compared to what they are in the main city, because of connectivity problems. Add to this the current downfall in the rental market of the city and the suburban properties in Ahmedabad emerge as the biggest losers