Crores spent go down the drain; who will pay the price?
Builders had planned 2.5 lakh houses in Noida extension. Considering the average cost of a house (Rs20 lakh), the idea was to rake in Rs50,000 crore.india Updated: Jul 22, 2011 00:07 IST
Builders had planned 2.5 lakh houses in Noida extension. Considering the average cost of a house (Rs20 lakh), the idea was to rake in Rs50,000 crore.
Nearly 1,00,000 flats worth Rs20,000 crore have been booked.
Half of these sold units were funded through home loans. Though banks sanctioned home loans worth Rs10,000 crore but, luckily, disbursed only Rs1,000 crore to buyers who have booked flats in Noida Extension, as most buyers had opted for construction-linked payments.
Those buyers who did not opt for home loans have been a little slow in payment and paid about Rs500 crore. With banks stopping funds and buyers asking for refund, these are tough times for builders too.
Builders have invested Rs10,000 in their projects. They have paid Rs5,000 crore to the authority as installments for the land allotted. The authority had allotted 3,000 hectares of land to more than 60 builders for Rs30,000 crore to be paid in installments. Builders have already carried out construction worth Rs2,500 crore.
The authority has spent Rs4,000 crore in terms of development of Noida Extension and compensation to farmers in Noida Extension villages. Now, the authority may have to return builders' money plus Rs400 crore to 3,000 allottees whose plots have been scrapped in the Patwari judgment.
The authority will find it difficult to bail itself out by taking bank loans. Banks give loans on the basis of land the authority has. Land parcels are slipping out of the authority's hand. It already has taken loans worth Rs4,000 crore.
(Figures based on rough estimations and statistics pieced together from builders, buyers, banks and authority)