Blame it on the slump in the real estate market or the failure of the Greater Mohali Area Development Authority (GMADA) in wooing investors, but another 300 successful applicants under the GMADA's Purab Premium Apartments project in Sector 88 have withdrawn from it.
On September 27, GMADA has already started construction of the 1,620 apartments in a 15-floor building. Besides the prices - `37 lakh for one-bedroom flat, `55 lakh for 2BHK and `69 lakh for 3BHK - the big thorn was the slump in the market and the stipulation that ownership cannot be transferred for five years, which meant no further sale for the virtual lock-in period. Those who have withdrawn lose 10% of the payment made in full.
But now, GMADA plans to float another scheme for these 300 flats, under which the five-year lock-in would be scrapped.
GMADA chief administrator AK Sinha said, "Since we have already given construction contract for 1,620 flats, we have to build them. For the 300 flats for which applicants have withdrawn, we will float another scheme that won't have the rule of minimum five years of non-transferable registration." However, a senior officer of GMADA underlined that the scrapping of the lock-in won't be for the remaining 1,320 applicants, "as they have already accepted our terms and conditions". The original plan was 4,500 flats.
Mohali Property Consultants' Association chairman Shalinder Anand commented, "In times of such a slump in the realty sector, the region is not ready for apartments at such high rates. Investors are disinterested owing to the clause barring further sale, which is one of the major reasons why the scheme did not attract much interest. At the prices of flats in this scheme, many better options are available in surrounding areas."
One of those who withdrew from the scheme, Gopal Krishan, resident of Phase 11, said, "We do not know when they would complete work. Though we had applied for the scheme to make some money, the present state of the market means it's wise to withdraw and not block the money."
Scheme and slump
In December 2011, under the Purab Premium Apartments project in Sector 88, GMADA had offered 4,500 residential flats in Sectors 88 and 89. But due to high prices and a slump in the market, most applicants withdrew. Considering the number of applicants left, GMADA finally decided to construct 1,620 flats. Now, it has only 1,320. The five-year no-ownership-transfer clause is a big downer for investors.
Trying luck with sites
On Monday and Tuesday, GMADA is to hold auction of various sites, including two group housing sites in Sector 66, a school site in Sector 78, two nursing home sites in Sector 61, and 18 commercial sites in Sectors 56, 59, 63, 65A and 70, besides residential plots in Sectors 61, 63, 64 and 67.