Centre's Stress Fund Could Provide Relief To 14,000 Homebuyers In Ghaziabad
On November 6, 2019, the centre approved a Rs 25,000-crore stress fund to aid the completion of over 1,600 stalled housing projects. This includes those projects that have been declared non-performing assets or admitted for insolvency proceedings. The centre's 'stress fund' could pull out approximately 14,000 troubled homebuyers in the Ghaziabad market. About 30,000 units are in various stages of construction in the region, where the average delay is of two to three years.
"The Rs 25,000-crore stress fund announced by the government is going to help around 40 to 50 projects in Ghaziabad, meaning benefit to 12,000 to 14,000 buyers awaiting delivery of their homes," Gaurav Gupta, president, Confederation of Real Estate Developers Association of India (CREDAI), Ghaziabad said. He also added that the terms for availing of this fund should be made known soon, so that builders and buyers could benefit. Any further delay in bringing out the modalities, could add to the number of stressed projects.
The industry body also expressed that the Real Estate Regulatory Authority (RERA) should be the first point of contact for homebuyers and not the National Company Law Tribunal (NCLT) or the Consumer Forum. Moreover, before initiating insolvency proceedings against any promoter, two-third homebuyers should give their consent.
18 Ghaziabad Builders To Undergo Forensic Audit Over Project Delays
After making a list of builders who have yet to deliver housing projects in the city, the Ghaziabad Development Authority (GDA) is set to launch action against wilful defaulters. Books of as many as 18 real estate developers in Ghaziabad will be audited by the authority to find out if funds collected from homebuyers were diverted for other purposes, resulting in a prolonged delay in project completion.
Earlier, the authority made a list of 115 developers, who have ongoing projects in the city, putting them in three different categories, A, B and C, depending on the work progress. The 18 builders whose books are likely to be audited have found a place in the C category in the GDA list. While 58 projects have been listed in the A category, 39 housing projects have been put in the B category. Data available with PropTiger.com show nearly 28,500 units are expected to be delivered in Ghaziabad in 2019, the highest so far.
If the developers listed in the C category are found guilty of diverting homebuyers’ money for other purposes than building the project after the audit, they might lose their licences and may have to do time, too. It may be recalled here that court-appointed auditors are going through the books of embattled realtors Amrapali Group and Unitech over similar issues.
Under the provisions of the real estate law, a real estate developer has to keep the money collected from homebuyers in a separate account, and he is not allowed to spend more than 70 per cent of this money for building the project for which the money has been collected. Any failure to do so may result in a monetary penalty.