Home buyers alert! RERA limitation leads to 72 pct delayed real estate projects in MMR, NCR
As RERA covers real estate projects post 2013, realtors have shown a lack of will to complete their delayed projects leading to a precarious situation for the home buyers.
Around 72 per cent of the delayed projects in India are in Mumbai Metropolitan Region (MMR) and Delhi-NCR. The industry insiders say it has happened despite the setting up of a regulatory mechanism, countless homebuyers have been left in the lurch by their builders because these projects don't fall under the ambit of RERA. Tightening credit crunch is also a reason for such delay, say realty experts.
Detailing over the delayed projects in MMR and NCR Anuj Puri, Chairman – ANAROCK Property Consultants said, "As per ANAROCK data, the top 7 cities currently have a total stock of 5.6 lakh delayed housing units worth a whopping Rs 4,51,750 Cr. These units were launched either in 2013 or before that. Lakhs of buyers across top cities – particularly MMR and NCR - have been left in limbo, leading to inconceivable mental stress and financial pain." Puri went on to add that the top cities like NCR and MMR collectively account for 72 per cent of the total stuck housing units across the top 7 cities worth Rs 3,49,010 Cr – nearly 77 per cent of the total worth of the stuck projects. In comparison, the main Southern cities of Bengaluru, Chennai and Hyderabad together account for a mere 10 per cent of the overall stuck housing units of a total worth of Rs 41,770 Cr. The Southern cities have predominantly been driven by service-class end-users, leaving limited scope for developers to be unprofessional.
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"Interestingly, among the two major IT destinations, Bengaluru is far better off than Pune in terms of the total number of delayed/stuck projects. The Silicon Valley of India has less than half of the total delayed stock in Pune (of 86,700 units). Chennai has the least project delays during this period, with around 8,650 units worth INR 5,620 Crore," said Anuj Puri of ANAROCK Property Consultants.
Elaborating upon the reason for such a whopping number of delayed inventories in MMR, NCR Rakesh Yadav, CMD, Antriksh India Group said, "Besides some developers' lack of real will to complete their projects and preference for funds diversion, the tightening credit crunch has been one major factor contributing to this mounting problem. It has become a 'chicken and egg' situation - buyers have understandably stopped releasing funds to builders, and builders claim they have no funds to complete construction. Also, every delayed project results in cost overruns which compound the funding crunch even further. Lack of project clearances for whatever reason also contributes to the piling up of housing stock. In the pre-RERA era, many builders launched greenfield projects without the requisite approvals in place, resulting in their projects getting stuck." Yadav said that the government-owned NBCC has been roped in to complete some stalled projects in NCR. This is a significant move which, if applied in larger numbers, can have a real impact.
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