Now that more than 6500 apartments may soon be registered in Greater Noida after at least 30 real estate developers have agreed to clear their dues under the 2023 realty policy of the Uttar Pradesh government, here’s what real estate investors wanting to put in their money into the property market should know.
Under the policy, the realtors of 30 stalled housing projects in Greater Noida will pay a total of ₹350 crore and obtain permission to execute registries of 6,500 apartments in their respective projects.
“At least 30 Greater Noida developers have given their consent and signed the agreement that will pay 25% of the dues to become eligible for carrying out registries of ready units in stuck housing projects. We are pursuing all realtors to get them to use the scheme and get permission for registry so that homebuyers no longer have to suffer,” said Saumya Srivastava, additional chief executive officer, Greater Noida authority.
Developers in Greater Noida who have accepted the government deal in Noida include – 13 realtors have also accepted the policy coming forward to clear the dues and obtaining permission for registry.
What is the UP Government policy?
Under the provisions of December 21, 2023, policy, real estate developers can avail of waivers on penal interest for two years — the Covid 19 period — and also for the period when construction got disrupted owing to court orders.
After deducting penal interests, these 30 developers have agreed to pay 25% of the total dues to become eligible for registry of apartments, officials said, adding that 30 more realtors are likely to agree to pay their dues.
What is the total amount that developers owe to the Authorities?
There are 57 stalled housing projects, having 32,000 units in Noida, and 96 stalled projects having 75,000 units in Greater Noida, that are eligible to benefit from this policy.
As per estimates, Noida realtors owe around ₹8,000 crore, and Greater Noida realtors defaulted to pay around ₹5,500 crore dues against the stalled projects.
Under the policy, the Authority can also cancel the allotment of defaulter developers
Under the policy, the authority has the mandate to cancel the allotment of defaulter realtors, who do not want to pay the dues, and take over the incomplete project. The policy also empowers the authority to blacklist the defaulter developer for a period of five years in the jurisdiction of the three industrial bodies — Noida, Greater Noida and Yamuna Expressway.
There are at least 96 stalled projects, comprising 75,000 units, in Greater Noida, which are in a position to use the 2023 policy, said officials.
Also Read: Real Estate Budget 2024: Focus on infrastructure, new housing scheme for the middle class
Process likely to be completed in one or two months
Once the processing is over, the authority will issue necessary permission and the process will be completed in one or two months, said officials.
The authority has formed three committees –each headed by a deputy general manager — to pursue all remaining realtors and get them to clear the dues and then obtain registry permission.
In Noida, only 13 of the 57 real estate developers of stalled housing projects have come forward to pay their dues after availing of interest waivers under the new policy.
Also Read: Noida authority ultimatum to realtors: Pay dues after waiver or face action
The Noida authority has issued an ultimatum to realtors that they either pay land dues in accordance with the new December 21, 2023, realty policy or be ready to face action.
The move comes after only 13 of 57 realtors of stalled housing projects came forward to pay dues till date, after availing of interest waivers under the new policy.
Seven of these 13 have already paid the dues and the remaining have given the consent and are in the process of making payments in order to get permission for registration.
Developers who have accepted the government deal in Noida include 13 stalled housing projects obtaining the permission for registries.
Why is it that more Greater Noida developers are coming forward to clear their dues but not so in Noida?
The Greater Noida developers are coming in big numbers to pay their dues because the amount that they owe the Authority is much less under the policy that provides for waivers. In Noida, the major developers including Supertech Group, ATS, Prateek Group, Gardenia Glory among others, have dues over ₹100 crore.
Also Read: UP-Rera to ask banks to provide funds to delayed real estate projects
“These developers also demand more waivers before they make up their mind to pay up the dues,” said the Noida authority officials.
In Greater Noida, however, more developers are coming forward to clear dues also because their dues are below ₹100 crore, said the Greater Noida authority officials.
Also Read: Can Indian real estate market face a crisis like China’s Evergrande?
Want to invest in Noida or Greater Noida? Here’s what you should know
According to Prashant Thakur, Regional Director & Head – Research, ANAROCK Group, the fact that more developers have agreed to clear their dues suggests progress and potentially faster project completion. Nevertheless, investors should exercise caution and thoroughly research the developer’s reputation, project approvals, track record for timely completion, and financial stability before investing. Always conduct thorough due diligence and stick to reputed, organized developers,” he said.
If there is any reason for uncertainty, it makes sense to seek professional guidance from a qualified real estate advisor to navigate the complexities of the market and make informed decisions. Organized consultancies will be able to offer genuine information. Smaller brokers not bound by best practices are apt to give misleading information just to close sales, he said.
With regards to the policy’s effectiveness in expediting project completion, it is important to monitor its progress and the developers’ compliance to get a clearer picture, he added.