Vadodara Real Estate: The Countdown Begins!

Investing in real estate is all about spotting the right opportunity at the right time. And with stable capital values coupled with ample supply on the back of limited investor activity, Vadodara evolves as a potential option for astronomical returns on investment.

Located on the banks of the Vishwamitri river, the pace at which Vadodara is developing is nothing short of remarkable. After the boom of 2006, the real estate market of Vadodara has never looked back. This growth is also reflected in the capital appreciation, a key determinant of returns in the real estate domain.

“Vadodara has recorded a significant price appreciation in the last two years. The key precincts in the city such as Alkapuri and Gotri recorded an appreciation of about 25-30 percent. Other areas such as Vasna-Bhayli, Gorwa and Race Course also recorded an average appreciation,” informs Ravi Purohit, director of residential wing, Comfort Realty Pvt Ltd.

Major growth drivers at play

Vadodara is Gujarat’s third-largest city. With several chemical industries setting up base here, the city became popular with the epithet of Chemical Industries Capital of the state. Further, the inception of various PSUs made it the first cosmopolitan city of Gujarat in the nineties.

Today, the city boasts of well-built social and physical infrastructure. However, there are several projects in the pipeline that will further improve city’s infrastructure and in turn will boost the realty market. These include Mumbai-Delhi corridor, Ring Road and many flyovers.

The city’s proximity to key industrial centers of Gujarat such as Ahmedabad, Bharuch and Surat, along NH-8 just adds another feather to Vadodara’s cap. Further, the proposed Vadodara-Ankleshwar Industrial Area along the Dedicated Freight Corridor will also boost the realty market of the city.

Rates and trends

In addition to the demand from the local people, Vadodara also has very high demand from NRIs. Interestingly, the property holding capacity in Vadodara is higher than most other cities such as Mumbai, Delhi-NCR or Bangalore among several others. Hence, the city fares far better than others during a realty slowdown.

However, in the last three to four months, sales have been relatively low on account of the general elections. “Even though small transactions have taken place, major land transactions are in the pipeline owing to which no major development has taken place. Atleast 75 per cent of the transactions are in the pipeline waiting for the new government,” adds Purohit. The average capital values in Vadodara fall within the brackets of Rs 2,000-3,500 per sq. ft.

The city evolves as a potential option from investment perspective as well. The sales velocity has been stable for quite sometime now, however the rental market is buoyant. Major residential localities such as Gotri, Alkapuri and Karelibauj recorded a rise of about 3-14 per cent. Rental values in Gotri appreciated owing to its proximity to the CBD of Alkapuri. Also increased activities at various projects including Sawli Industrial Zone, Halol, etc. has given an impetus to the realty market of these areas. While General Motors was already present at Halol, a German company -Toto has recently entered here, thereby raising rental demand.

Where to look for a house?

The prime residential areas in Vadodara are Alkapuri, Race Course Road, Old Padra Road, Jetalpur, Akota,Vasna Road,Gotri,Sewasi and Fatehganj.

In the West, one can look for a standard 2BHK apartment in the range of Rs 2,200-5,500 per sq. ft, in localities such as Alkapuri, Akota, Vasna Bhayli and Gotri . However, for affordable properties, one should consider western part of the city. In the range of Rs 1,200-2,200 per sq. ft., one can easily get a 1000 sq. ft. unit in localities such as Waghodia Road, Dabhoi Road and Ajwa Road.

New Projects

Currently, there are both under construction and ready to occupy projects. Though developers are offering varied configuration ranging from 2-6 BHK units, buyers interest in mostly inclined towards 2BHK units closely followed by 3BHK units.

The new launches were mainly skewed toward areas such as Ajwa Road, Atladra, Gorwa, Gotri, Bhayli, Waghodia Road and Sama Savli Road. Developers active in the city include Fortune Group, Pyramid Constructions, Bajaria Group, Pawan Group, Iscon Group, to name a few.

“There is a price pattern which is visible during the election time. As the elections approach approximately six months before, the price rise go on hold due to customer sentiments. Prices a month before elections are at its peak and stick there till the end of polls,” informs Hrishi Kumar, manager, ICCPL.

All in all, the market is stabilised at present, but is likely to grow as the polling season is over.There has been a price correction of 10-15 per cent in some localities in the last 3-4 months. This is relatively better than most other cities in the state including Ahmedabad, which has seen price dip of almost 25 per cent.

Thus, experts feel that this is the best time to invest in a property as post elections prices are expected to rise. Till then, let these statistics be your guide.