New Delhi: The
housing ministry has urged the finance ministry to expedite setting up of a “stress fund” to complete housing projects in Noida and Greater Noida that are stuck.
It has also suggested to the Uttar Pradesh government to implement recommendations of a high-powered committee to bring relief to lakhs of homebuyers who have been waiting for their
flats for years.
Sources said Union housing secretary D S Mishra has written to the financial services department for early creation of the fund. Mishra, who headed the UP government-appointed high-powered committee, said, “Builders and
buyers cannot be dissociated. The focus is to complete projects. The recommendations have been made with a focus on buyers. Direct relief or relaxations to builders have been suggested, only if they give written undertaking to complete projects within three years,” he said.
TOI had on September 6 first reported the recommendations suggesting that the UP government re-introduce the Project Settlement Policy (PSP), which the state had brought in 2016 for six months to address delays in delivery of flats due to farmers' agitations, stay orders by courts on construction of flats, and land acquisition.
Under this policy, builders get certain financial relief in the form of a reduction in penal charges for the period of delay, zero interest if the work was stopped due to court orders, or no interest if more than 30% of the allotted land was not handed over to the
builder due to some dispute. They also get the option to bring in a “co-developer” to complete projects where vacant land is available and the original builder does not have funds.
The builder will, however, have to pay back the concession if they fail to complete projects within three years.
“Presently, nobody wants to put the money in stalled projects as there is no guarantee of the return on their investment. Second recommendation of the committee pertains to last-in first-out (LIFO) model for execution of the stress fund to ensure the confidence of investor to put its money in order to complete the stalled projects,” the housing ministry said.
The committee has also suggested allowing homebuyers to get the title deed registered on stamp duty at the circle rate prevalent at the time of the committed date of the completion. As circle rates have increased by up to 50% since 2013, when most projects were supposed to be completed, the recommendation will benefit homebuyers.
Another significant recommendation of the committee was the establishment of one Real Estate Regulatory Authority (Rera) for Noida, Greater Noida Ghaziabad and nearby areas. At present, the region comes under UP-Rera, which is based out of Lucknow.
