As many as 1,443 projects equalling 4.4 lakh homes spread across 550 million sq ft are completely stalled in the top seven cities
Around 4.4 lakh housing units across India worth Rs 3.1 lakh crore face construction delays, a report by online subscription-based real estate data analytics platform, PropEquity found.
As per the data, as many as 1,443 projects equalling 4.4 lakh homes spread across 550 million sq ft are completely stalled. These projects are situated in the top seven cities of Bengaluru, Chennai, Hyderabad, Kolkata, Mumbai Metropolitan Region (MMR), Delhi-NCR and Pune.
Of the stalled projects, nearly 1.9 lakh units valued at Rs 1.3 lakh crore are in NCR alone, MMR has 97,686 units worth almost Rs 1.01 lakh crore pending, and end-user driven market Bengaluru has as many as 32,464 units worth Rs 0.22 lakh crore facing delays, the report said.
The projects are on hold for a variety of reasons like financial constraints, execution challenges, surplus supply due to over-ambitious launches by developers, environmental clearances and slow sales among others, the report pointed out.
There is a marginal improvement from the past year, as data released by the firm in August 2018 found that 1,687 projects worth Rs 3.3 lakh crore faced construction delays.
"The a marginal improvement in project completion over the past year is because of tardy progress on the ground and slow improvement in converting projects on hold into working projects," Samir Jasuja, Founder and Managing Director of PropEquity said.
"The government has started looking into projects that have faced maximum delays to ensure that they see the light of day at some point in time. Developers themselves have been forced to cut down on new launches and instead focus on execution. The problem of delayed projects is massive and worrisome," Jasuja added.
He added that projects that are complete or nearing completion attract the maximum buyers as they seem to be most risk-averse.
With the real estate sector accustomed to reforms such as GST and RERA, absorption of ready-to-move-in units and those nearing completion are being preferred. The affordable and mid-income segment is expected to further grow due to favourable government policies."We also believe that projects by renowned developers with strong fundamentals would continue to do well irrespective of the stage of construction. We also foresee an era of consolidation led by larger and more capable developers who have the construction and execution capability to meet their commitments," he added.Get access to India's fastest growing financial subscriptions service Moneycontrol Pro for as little as Rs 599 for first year. Use the code "GETPRO". Moneycontrol Pro offers you all the information you need for wealth creation including actionable investment ideas, independent research and insights & analysis For more information, check out the Moneycontrol website or mobile app.