Homebuyers who had invested in areas around the Okhla Bird Sanctuary had seen a ray of hope in the government’s final notification setting limits of 100 metres around the eco-sensitive zone around the Okhla Bird Sanctuary on August 19, 2015. With 60,000 apartments expected to be delivered, realty experts, too, said they expected a revival of the Noida market, with which most of the projects around the bird sanctuary are associated. Till date, major signs of revival are still not visible in the market.
Positive outcomes so far have been the slight pick-up in demand in the existing inventory, as claimed by developers; issuing of completion certificates by Noida Authority for housing projects, enabling many homebuyers to get legal possession of their apartments after long delays.
The situation is no different along the Noida-Greater Noida Expressway, a 35 km six-lane highway which connects Noida with Greater Noida, once marketed by developers in the area as the USP of their projects with real estate activity as subdued as in other Noida areas. “Any project along the Noida Expressway boasts of a prime location and easy connectivity to Delhi, Greater Noida and other sectors within Noida, but as other Noida sectors have become equally well-connected and have better locations, the highway can no longer remain a major attraction for buyers. Housing projects in other sectors of the city have also been delivered, but delayed possession in projects near the Expressway means dashed hopes of homebuyers,” says Gaurav Tiwari, a Noida broker who had to shut shop because of poor demand for housing in the market. Now working as a senior relationship manager with a leading real estate consultancy firm, he says “We literally have to beg customers to buy apartments. It is difficult to market premium projects along the Expressway,” Tiwari adds.
For investors, too, the lack of demand is proving to be disconcerting. “I had bought a flat measuring 1,200 sq ft at the rate of Rs 4,050 per sq ft in June 2012 in a leading group housing project along the Expressway. After a year or so, the price went up to Rs 5,200 per sq ft, but today even if I want to sell my flat at Rs3,800 I am not getting buyers,” says Sudhir Sood, a resident of sector 44, Noida.
Ravi Sinha is another desperate seller who bought a 3BHK unit in 2009-10 in a project in Sector 151 along the Expressway at R2,100 per sq ft. After six years, he is ready to dispose of property, which is still under construction, but buyers are not turning up.
Developers and real estate agents had for long been saying that the slump in the market had been caused by the National Green Tribunal orders on March 12, 2012, restraining Noida Authority from issuing completion certificates for projects within a 10 km ‘protective’ zone around the sanctuary. Though NGT had not imposed a ban on construction, many developers also stopped work on projects and asked homebuyers to wait for further orders from the government. However, now that the final zone has been demarcated, the builders have shifted blame to other factors such as high interest rates and low confidence of consumers in the market.
“With ambiguity around the eco-sensitive zone in Okhla cleared, Noida has not only seen commencement of possession and delivery but also a slight pick-up in demand in existing inventory. NCR battles with high level of inventory accumulated over several years. As macroeconomic factors do not as yet encourage a sudden spurt in housing demand, developers, too, are staying away from launching new projects. High interest rate and low confidence of consumers on the recovery prospects of the Indian economy have seen them postponing buying decisions. This phenomenon isn’t just restricted to housing but to consumer goods, automobile, etc as well. Muted loan growth too suggests lack of confidence,” says Mohit Goel, CEO, Omaxe Ltd.
Some realtors, however, feel that it’s too early for the market to react to the final notification. “The demarcation of the sanctuary’s protective zone will have a huge impact and will bring positivity to the primary and secondary markets.The Noida market in the last two years faced difficult times and a major reason for this was the uncertainty over the bird sanctuary. Due to this, buyers hesitated to invest in properties. We are confident that the market will now show positive growth due to the resolution of the sanctuary issue and also the reduction in the interest rates of home loans,” says Vidya Basarkod, president, sales and marketing, Jaypee Greens.
Jaypee Greens has over 4500 apartments ready for handover and will start giving possession as soon as the company receives completion certificates from the Noida Authority. “We are hopeful that this will create a positive buzz about our projects and will reassure prospective customers,” says Basarkod.
About the sanctuary issue, Basarkod says, “it did create a sense of uncertainty which affected both the primary and secondary markets. It also was a cause for financial burden to the existing buyers due to delay in possession but we are hopeful that this will not have a long-term effect. The market should show signs of growth and improvements in the coming months. Also customers are intelligent and understand that this was a specific issue and not a fundamental problem with the Noida market.”