By Varun Singh

Homebuyers Vivek Shinde and Yojana Shinde, had booked a flat in Nirmal Lifestyle Blu Diamond, Mumbai.

Nirmal Lifestyle executed the agreement for sale in favour of the homebuyers in March 2003, but didn’t mention the date of possession

The homebuyers then informed MahaRERA that in a letter to the bank, the developer informed date of possession as March 2006.

The homebuyers were seeking interest for the possession of the flat for which they had already paid Rs 28.17 lakh.

Nirmal Lifestyle contented that, they had first received the commencement certificate in 2002, but in 2004 an 2005, circulars from the department for Forest and Revenue by which the project land was declared private forest.

Thus construction activities stopped until Supreme Court issued an order in January 2014.

The developer thus contended that the construction activites stopped since 2006. The builder also mentioned that the nationwide lockdown since March 2020, causing shortage of labour and material and hence further impacting the construction activity. The developer informed that the project would be completed by December 2021.

Nirmal Lifestyle thus contended that it was prevented by sufficient causes beyond its control, from completing the project as per timeline.

MahaRERA noticed that there was no dispute that the developer hadn’t mentioned the date of possession in the agreement.

As per MOFA and RERA it is obligatory to mention the date of possession in the agreement.

MahaRERA even noticed in the order that the developer hadn’t taken any steps to rectify the agreement even after RERA coming into force.

Dr B D Kapadnis, Member II, MahaRERA, who was hearing the matter noted that the developer had violated section 13(2) of RERA.

Kapadnis then quoted a Supreme Court order, where the Supreme Court in the case of Fortune Infrastructure Vs Trivor D’Lima had held that in agreement were date of possession wasn’t mentioned the reasonable date of possession is only three years.

Thus in this case, MahaRERA noted that the possession was due on March 2006, even as per MOFA the possession date cannot be extended beyond six months even if the project wad delayed for reasons beyond the control of the developer.

Kapadnis in his order mentioned that, therefore the liability to pay interest to the homebuyer by the developer starts from September 2006.

Nirmal Lifestyle was ordered to pay interest on the amount paid by the homebuyer at 9% per annum till handing over of the possession of the flat.

The developer was also asked to pay Rs 20,000 to the homebuyers towards cost of the complaint.

The developer was also asked by MahaRERA to handover the possession of the flat at the earliest but not later than December 2021, with agreed amenities and occupancy certificate.

Also Read: Real Estate History Created: Sales Surpass 10K

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By Varun Singh

Real Estate industry is troubled and there’s no doubt about it. The downturn because of the lockdown due to COVID 19 pandemic has impacted all business.

However, amidst all the bad news and advices from various ministers and industry stalwarts to reduce prices, here’s some good news.

Lodha Developers has announced that it has crossed the sales of 1,000 homes in Mumbai region.

What is important that Lodha crossed this figures during lockdown when everyone is finding it difficult to run business smoothly.

The company claims it witnessed 85% of sales across its ready homes or nearing ready homes, indicating consumer preferences in the current market scenario.

The developer even carried out a research during the lockdown. They found out that the pandemic has significantly increased the desirability of owning a home rather than renting it.

With people starting to spend more time at home and work from home (WFH) becoming more prevalent. Having a good quality home with amenities and infrastructure has become important.

According to the developer, people on rent have also seen a the difference in the attitude of Residents Welfare Associations towards them. And accordingly this has also made them more eager to buy their own home. 

What worked for Lodha?

Lodha says they put together ‘Apna Ghar, Apna Desh’ initiative. This offers the option of a very low upfront payment, low interest rates of 5.99% on EMIs, and ready to move in homes where one does not pay rent and pre-EMI at the same time.

Abhishek Lodha, MD & CEO, Lodha Developers said; “The lockdown has re-iterated the importance of owning a high quality home in well-developed and well-maintained buildings.”

Lodha says, he has seen that customers have a clear preference for buying ready homes. And believes the sale of these 1000 homes will create at least 10,000 jobs for a year. And lead to large amounts flowing to the government for nation building.

The developer has contributed Rs 21,000 to the PM CARES fund for every home sold under Apna Ghar, Apna Desh campaign.

Earlier even Godrej Properties had announced that it had sold 500 homes during the second half of March. Godrej had said, this was possible as the company focused on digital sales tools to sustain operations despite the lockdown.

Also Read: Reduce prices to survive or suffer: Goyal to builders

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By Varun Singh

Covid19 has raised its head and many are suffering especially the poor. In such times of need some developers have decided to not think of profits.

Due to the impact of Covid19, several construction workers are suffering too. While many were migrating, some developers saw to it that their construction workers didn’t suffer.

A Mumbai based developer Chandak group because of Covid19 distributed ration of 1-month to all its construction workers.

Their Facebook page said, “During these challenging time, we are doing our bit for the people who work tirelessly for us.”

Many developers are also known for not full refunding the cancellation fee. However, because of Covid19 the developers have even started refunding entire cancellation amount.

Migsun Group, a Delhi based developer says, “We have also taken care of the cancellation part where we are assuring full refund if a buyer changes his or her mind. Offers are for Greater Noida projects in ready-to-move-in projects or the ones that are going to be ready within six months.”

Amidst Covid19 some developers are also making EMI free for the first three months,

Meanwhile, Mumbai’s Lodha Group last week announced that it has waived off the rentals of close to 200 retail outlets on its property. This move was taken after PM announced a national lockdown.

Some builders even provide advance salaries to their workforce, so that they can tackle the emergencies arising out of Covid19.

Even builders body CREDAI has said that they are ensuring amenities for the construction workers.

Satish Magar, President, CRDAI National had said, “We are also ensuring that our construction workers are provided with basic amenities to be able to cope up with the ongoing situation.”

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By Varun Singh

RBI didn’t announce a rate cut, while the real estate industry was expecting it, but it didn’t come. Amid the growing concerns over the economic impact of Covid-19, the RBI was expected to agilely tread along the lines of its western peers and announced an emergency rate cut to ease growing economic pressures and infuse liquidity into the system.

RBI rate cut is one means of staving off a recession which may arise due to the coronavirus spread. Countries like US, England, Australia, New Zealand, etc. have all gone ahead with such emergency rate cuts in order to fend off the potential brunt of an exacerbated liquidity crisis.
 
Anuj Puri, Chairman, Anarock Property Consultants says, “The expected emergency RBI rate cut did not materialize. The question of whether it would have helped the Indian real estate sector in the current scenario does, in any case, not have any easy answer.”

How does a RBI rate cut help? The answer is that, a rate cut sends out positive signals. With the recent shut downs and lock down measures being taken, e-commerce will in any case benefit over the short-term and brick-and-mortar retail will not until malls open again – and people feels safe enough to visit them.
 
But will a rate cut benefit in such times? Puri says, “A rate cut would also have done little to boost housing uptake, as the recent advisory for social distancing has impacted site visits and thus overall housing sales.”

Most Developers will choose to defer new launches and will wait to see how the situation unfolds over the next month or two. A rate cut could have addressed overall liquidity concerns to some extent, but many developers will keep new launches on hold. Construction activity may also take a hit if the situation becomes worse.
 
Manju Yagnik, Vice Chairperson, Nahar Group and Vice President, NAREDCO (Maharashtra), says “Central banks across the globe have started taking action by cutting rates – U.S. Fed has cut rates by 150 bps to near zero, agree with Indian central bank RBI as it has decided to wait and assess the overall impact of Corona virus on Indian economy before deciding on its next rate action.

While a rate cut will boost sentiments of real estate, central bank’s assurance on stability of banking system and safety of their funds in the form of bank deposits will boost confidence in the Indian Banking System.

“Faster cure to the virus, increased liquidity, low rates, positive business sentiments and high economic growth will directly impact fortunes of Indian real estate sector,” she added.

Also Read: COVID 19 impact, site visits and enquiries to see a dip

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By Varun Singh

Indian retail will be facing a tough time now. The corona virus which has already derailed a lot of things, will now have a major impact on the retail business.

Amid the rising number of coronavirus cases in the country. The order of closure of malls and multiplexes across many top Indian cities by the respective state governments to prevent people congregating for any reason, has caused the organized retail scene in these cities to come to a grinding halt.

Only on Friday did the Maharashtra government decided that that certain places where the public congregates shall be closed.

Many offices have asked their staff to work from home so that they can avoid the deadly corona virus infection.

Also Read: Corona may hit Indian Real Estate hard

Anuj Kejriwal, MD & CEO – ANAROCK Retail says, “Wherever it has been mandated, there will be a high number of establishments that need to shut down for operations. Even short-term closures will have significant financial implications.”

The top 8 main Indian cities have 126 malls sprawling over more than 61 mn sq. ft. area, and more than 100 malls have multiplexes attached.

However, what matters more is that these establishments attract massive footfalls. In a health crisis like the coronavirus pandemic, shutting them down can be a major step forward in terms of harm-prevention.

Do Read more about Corona here

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