In a significant move expected to benefit nearly 2.5 lakh homebuyers, the Uttar Pradesh Cabinet, on December 19, approved the recommendations put forth by the committee led by Amitabh Kant. This committee, comprising experts and officials, had been tasked with addressing the prolonged delays in real estate projects, particularly in the Noida and Greater Noida regions, where over 35% of housing units have faced significant setbacks.
Swift Action for Homebuyers
The decision, which comes as a respite for homebuyers grappling with delays, involves the immediate implementation of the recommendations outlined by the central committee chaired by former Niti Aayog CEO Amitabh Kant. Suresh Kumar Khanna, the state’s Minister for Finance and Parliamentary Affairs, emphasized the primary focus on safeguarding buyers’ interests. The objective is clear: ensure prompt possession and registration for those who have invested in homes.
Zero Period Relief
Additionally, the Cabinet has given the nod for the application of ‘zero period’ relief, as suggested in the committee’s report. It’s crucial to note that these approvals are specific to residential projects, excluding commercial, sports, or entertainment developments.
The magnitude of the Issue
According to estimates by the Indian Banks Association, approximately 4.12 lakh homes nationwide remain incomplete due to financial challenges faced by developers.
Of this staggering number, around 2.40 lakh homes are situated in the National Capital Region (NCR), encompassing Noida and Greater Noida.
The implementation of the committee’s recommendations aims not only to protect homebuyers’ interests but also to expedite the completion of stalled legacy projects.
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Applause from Real Estate Stakeholders
The Uttar Pradesh cabinet’s decision has garnered widespread support from real estate experts, developers, and homebuyers alike. Industry insiders believe that this move will directly benefit the NCR region, relieving approximately 2.40 lakh homebuyers from the ordeal of prolonged project delays.
Lasting Impact on Real Estate
Project delays have plagued the Indian real estate sector over the past decade. The Real Estate (Regulation and Development) Act (RERA) had a moderate impact initially, but a major turning point occurred in 2019 with the establishment of the Alternate Investment Fund (AIF) endowed with a ₹25,000 crore corpus. The SWAMIH fund, a last-mile capitalization mechanism, played a pivotal role in reactivating stalled projects.
Now, with the approval of the Amitabh Kant committee’s recommendations by the UP cabinet, the focus shifts to Noida and Greater Noida, which have been disproportionately affected by stalled residential projects. These areas, contributing over 35% to the total delayed units across the top 7 cities, stand to gain immensely.
Positive Reactions from Industry Leaders
Manoj Gaur, President of CREDAI NCR and CMD Gaurs Group, expressed optimism, stating that the exemption of interest during the zero period will ease the financial burden on flat owners. This, in turn, facilitates the registration of homes without additional financial strain.
Amit Modi, Director of County Group, views the UP government’s decision as a positive development benefiting stakeholders, including financial institutions, authorities, state exchequers, and developers. Experts expect the move to streamline home delivery and registration, ensuring timely payments to authorities and boosting state revenues.
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Revitalizing Stalled Projects
The UP Cabinet’s approval of the Amitabh Kant committee’s recommendations is poised to revive stalled real estate projects in Noida, Greater Noida, and along the Yamuna Expressway.
Piyush Bothra, Co-Founder and CFO of Square Yards anticipates renewed confidence among homebuyers, driving increased investment in the real estate sector.
Community Response
Abhishek Kumar, President of the Noida Extension Flat Owners’ Association (NEFOWA), welcomed the move, expressing hope that it would address all issues faced by homebuyers.
The Amitabh Kant-led committee, established by the housing ministry in March, aimed to tackle legacy-stressed projects. Its recommendations, now approved by the UP Cabinet, highlight the importance of delinking project registration from builders’ due recoveries. The committee stressed that financial viability is a primary concern, advocating the use of judicial interventions as a last resort.
In conclusion, the UP government’s proactive measures signal a positive turn for the real estate sector, promising relief to homebuyers, revitalization of stalled projects, and a boost to overall confidence and investment.
Frequently Asked Questions (FAQ’s)
Ans: Homebuyers can anticipate prompt possession and registration of their homes, addressing concerns that have persisted for over a decade in some cases.
Ans: The recommendations hold substantial importance as they have received approval from the Uttar Pradesh Cabinet, providing relief to nearly 2.5 lakh homebuyers stuck in delayed projects, particularly in Noida and Greater Noida.
Ans: The SWAMIH fund, established in 2019 with a corpus of ₹25,000 crore, served as a last-mile capitalization mechanism, effectively reviving stalled projects. It played a crucial role in mitigating the impact of delays in the real estate sector.
