The Noida authority has recently released a list of 58 realty projects that have defaulted on land cost payments to the government, warning homebuyers not to invest in these projects. This move comes after much demand from homebuyers since 2017 for greater transparency in the real estate industry. The list includes all Noida developers, including Supertech, ATS, Logix, AIMS MAX Gardenia, Assotech, and 3C, who are categorized as financial defaulters.
According to Prasoon Diwvedi, officer on special duty, Noida authority, the details of all realty projects will be revised on a monthly basis. Interested parties can access the information online through the authority’s website.
Out of a total of 115 projects, 34 have been marked as “safe” because the promoters have paid their financial dues on time. Buyers may purchase flats and execute registrations in these projects. On the other hand, 65 projects are financial defaulters, and buyers cannot execute registry to transfer the property title to their names because the promoters have failed to pay dues to the authority. Fifteen of these 65 projects are facing insolvency and bankruptcy proceedings as they have defaulted on dues to lenders, including the Noida authority.
An anonymous Noida authority official explained that if a promoter pays the financial dues on time, the authority will allow the firm to execute registries, which paves the way for the transfer of the property title to the buyer. The authority prohibits registry on financial default so that the realtor is forced to clear the dues. The authority will revise the list on a monthly basis and remove the name of a builder from the defaulter category after they clear all dues.
Developers have responded to the list with criticism, stating that they will not come out of the defaulter category until the government comes up with a policy that enables them to make payments. Amit Modi, secretary of the Confederation of Real Estate Developers Association of India (CREDAI), a realtors’ lobbying group, explained that no realtor wants to be on the list of defaulters as it would make them ineligible for loans. They are unable to pay their dues because they are facing a financial crisis, and this crisis will only be addressed when the Uttar Pradesh government comes up with a policy that rationalizes their dues and waives the interest component.
Homebuyers have welcomed the authority’s move to make the list public. They believe that it will create awareness about realty projects and prevent new buyers from investing their life’s earnings in sick or stuck projects. “Even so, Noida authority delayed uploading the details for so many years. Had there been more transparency earlier, many would have been saved from investing in defaulted projects,” said Arun Chauhan, a buyer who bought a flat in Aranya project in Noida.