AHMEDABAD: The real estate sector in the state is grappling with several challenges following the recent release of draft jantri rates, with increases of up to 900% in developing areas. The draft rates were introduced months after a previous rate doubling in 2023.
In many developing areas, the rate increases from 2023 could reach 2,000%, raising concerns about land deals and project costs.
The proposed hikes have prompted builders’ associations and farmers’ groups to prepare representations seeking relief from state govt.
A leading developer said, “The recent hike in jantri rates appears excessively steep and will severely affect farmers, homebuyers, homeowners and the real estate sector.
In April 2023, the state govt implemented a 100% increase in jantri rates. Now, the newly proposed rates are set to rise by 50% to 1,000% from the current levels. For example, jantri rates for open plots are proposed to be increased by 965% in Godhavi, 700% in Tragad and 621% in Shela.
This means an effective increase of up to 2,030% compared to pre-April 2023 rates, making it possibly the steepest jantri rate increase in Indian history.” Dhruv Patel, president of Credai Ahmedabad, said, “This type of jantri hike will make new projects unviable due to higher stamp duty and FSI rates, and farmers will struggle to find buyers for term land. Our members will be meeting on Dec 3 to discuss these impacts before presenting our objections to the state govt.”
Patel warned that implementing these draft rates could bring the real estate sector to a standstill.
Taral Shah, managing director of a real estate company with projects in developing areas, said, “In many areas, jantri rates now exceed actual land costs. This will impact FSI and TDR costs, threatening project viability. Land deals in the city’s developing areas are likely to freeze until we get clarity on these rates. With demand for housing already sluggish for the past few months, this hike could further stress the sector.”
