Homebuyers who booked flats in housing projects in the Noida-Greater Noida property market are worst affected, with over 1.65 lakh flats worth Rs 1.18 lakh crore currently stalled or significantly delayed in these two cities, according to property consultant Anarock.
In its research, the consultant has taken only those housing projects that were launched in 2014 or before, across seven big property markets -- Delhi-NCR, Mumbai Metropolitan Region (MMR), Kolkata, Chennai, Bengaluru, Hyderabad and Pune.
Expressing concern over the plight of customers whose investments are at stake, Forum for People's Collective Efforts' (FPCE), an apex body of homebuyers, President Abhay Upadhyay told PTI that the cause of the delay of each project should be ascertained and solutions must be found.
He also sought stern action against defaulting builders.
According to the Anarock data, 4,79,940 units worth Rs 4,48,129 crore are "stalled or heavily delayed" across these seven cities as of May 31, 2020.
Out of this, Delhi-NCR alone accounts for a whopping 50 per cent with 2,40,610 stalled or delayed units worth Rs 1,81,410 crore.
Giving further breakup of the Delhi-NCR data, Anarock said that Noida and Greater Noida region account for nearly 70 per cent of total stuck/delayed units while Gurugram's share is only 13 per cent.
In Noida and Greater Noida, there are 1,65,348 units worth Rs 1,18,578 crore stalled or delayed units.
While Gurugram has 30,733 units worth Rs 44,455 crore stuck/delayed, the Ghaziabad market has 22,128 such units valuing Rs 9,254 crore.
Delhi, Faridabad, Dharuhera and Bhiwadi together have 22,401 stuck/delayed units worth Rs 9,124 crore.
"Project delays have been the bane of the Indian real estate sector over the last decade, particularly in NCR. Even the implementation of RERA (realty law) had only a little impact on this," Anarock Senior Director & Head - Research Prashant Thakur told PTI.
Among other factors, he said the liquidity crunch threw up roadblocks for many developers in the NCR.
The government's Rs 25,000 crore stress fund, which was launched in 2019 and called as SWAMIH, has proved to be effective in reviving many stuck projects, he added.
"Needless to say, real estate activity in Greater Noida earlier boomed on the pretext of boosted connectivity to Yamuna Expressway which passes through this region. Builders cashed on the connectivity prospects and launched innumerable projects over the years. Builders also launched projects in Greater Noida West which are now stuck under various stages of non-completion," Thakur said.
Anarock did not mention the names of the developers as well the projects that are stalled or significantly delayed but Jaypee Infratech, Unitech, Amrapali and The 3C Company are some of the big companies whose projects are stalled in Delhi-NCR.
There are many other builders who have defaulted on their promises to deliver their projects on time to customers, who have already paid almost the entire purchase price.
Not only that, they are also paying interest on home loans with no signs of any quick resolutions.
Against defaulting builders, homebuyers have approached various courts as well as the National Company Law Tribunal (NCLT) to secure their investments.
For example, Jaypee Infratech Ltd (JIL) went into the Corporate Insolvency Resolution Process (CIRP) in August 2017.
After several rounds of bidding, Mumbai-based Suraksha group in June last year received the approval of financial creditors and homebuyers to takeover the JIL, raising hopes for more than 20,000 homebuyers of getting possession of their dream flats.
Suraksha group is yet to get approval on its resolution plan from the NCLT.
In the case of Unitech, the Supreme Court in January 2020 allowed the Centre to take total management control of Unitech, once the country's second-largest realty firm, and appoint a new board of nominee directors.
Yudvir Singh Malik was appointed as the new CMD after the Central government superseded the Unitech board.
This decision was aimed to bring respite to over 12,000 hassled homebuyers of Unitech, but the customers are still waiting for the possession of the flats.
In Amrapali, the state-owned NBCC has undertaken the completion of many residential projects in Noida and Greater Noida under the aegis of Amrapali Stalled Projects and Investment Reconstruction Establishment (ASPIRE) and the supervision of the Supreme Court.
Around 40,000 homebuyers are stuck in various projects of Amrapali group.
"There are still huge number of pre-RERA era delayed projects which are incomplete. Such projects need to be properly identified and the cause of delay ascertained," Upadhyay of FPCE told PTI.
If the main reason is the paucity of funds due to fund diversion, he said the promoters of such projects then need to be dealt with sternly including recovery of funds from his personal assets.
"However, if there are other administrative or regulatory reasons, then the respective authorities must make an attempt to resolve the issues on a case-to-case basis," Upadhyay said.
The FPCE President said the RERA authorities should take the initiative to ensure that delayed projects are completed at the earliest.
After the Delhi-NCR market, the MMR has the second-highest stalled or delayed units. Southern cities Bengaluru, Chennai, and Hyderabad have just 9 per cent.
Pune has about 9 per cent share, while Kolkata accounts for 5 per cent.
There are 1,28,870 units worth Rs 1,84,226 crore in the MMR that are stuck/delayed. Bengaluru has 26,030 stuck/delayed units worth Rs 28,072 crore.
Hyderabad has 11,450 stuck/delayed units worth Rs 11,310 crore.
In Chennai, 5,190 units worth Rs 3,731 crore are currently stuck or significantly delayed. Pune has 44,250 units worth about Rs 27,533 crore that are stuck/delayed, while Kolkata has 23,540 such units valuing Rs 11,847 crore.
Anarock is mainly into housing brokerage and sells flats on behalf of the developers. It achieved a 32 per cent growth in its revenue at Rs 402 crore in the last fiscal.