In what could prop up the demand of residential real estate in the Noida Extention and improvement of market condition in Noida, the Supreme Court on Thursday refused to interfere with the land acquisition proceedings upheld by the Allahabad High Court in 2010.
While the micro-market was facing problem of high supply and unsold inventory, industry players believe that this will bring the fence-sitters into the market and the absorption levels will go up.
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“Noida extention offers affordable houses from good developers and emerged as an attractive destination for all those looking to buy house at affordable rates. However, people were waiting for the court judgement before they could lock their savings. Now that the risk is no longer there, the demand for the house in that area will rise,” said Getamber Anand, CMD, ATS Infrastructure and currently national president of Confederation of Real Estate Developers Association of India.
While Noida Extention is known to be a market for affordable houses attracting end-users, there are some who feel that it also brings relief to all those people who had invested their hard earned savings for their houses.
“We now expect these affordable residential markets to see increased transaction activity as demand in the segments up to mid-income remains strongest even in current market conditions,” said Sanjay Dutt, managing director, South Asia, Cushman & Wakefield.
Apparently, while the real estate market has been under stress, the demand for affordable housing has been growing.
The case that involved farmers fighting against the development authorities saw them file an appeal with the Allahabad High Court to cancel the land acquisition done by the Greater Noida Authority in the period between 2006 and 2009.
The High Court had in 2010 upheld the acquisition of land by the developers. Stating that the land will not be given back to farmers, the Court asked the two authorities to raise the compensation and give 10 per cent of developed land to farmers.
On Thursday, the Supreme Court bench led by Chief Justice H L Dattu turned down a batch of appeals filed by farmers of various villages as they challenged the acquisition of their land.
There are some who feel that it will also help developers unlock their investments from that market.
“So far hundreds of crores have already been invested for the development of the area. This order will enable unlocking value for all stakeholders and help the customers, developers and financial institutions redeem their capital that had been in deadlock after the objections were raised,” said Manoj Gaur, president, CREDAI NCR.
He further added that development of the region had taken a setback due to various regulatory challenges.
Look before you fall for these schemes from developers
Subvention scheme: This is the most commonly used scheme to attract buyers where the home-buyers are only required to pay a small amount — 5-20% of the price and the rest is funded by a bank and the EMIs for that starts either on possession or after such specific period as stated by the developer. Registration is compulsory.
Buyers opting for such schemes should note that most developers charge higher per square feet prices compared to rates offered in construction-linked payment schemes.
20:80 Scheme (Without Bank Funding): This is a variation of the subvention scheme where a buyer needs to pay 19.9% of the total contribution, and will pay the balance 80% on possession or after such specific period as mentioned by the developer. Registration may or may not be compulsory in these projects.
Interest Waiver For 12/24/42 months: In this scheme, buyers get a waiver of EMIs for the stated number of months, subject to the loan tenure. A bank loan and registration of the property is compulsory under this scheme. This scheme should be studied closely by buyers – in particular, the interest rates applicable after the interest waiver period must be ascertained.
Lower Interest Rate (7.99%) For 2-3 Years: Buyers opting to book a flat under this scheme get a reduction in interest rate for two to three years. The rate on a housing loan is lower at 7.99% – for a specific period as offered by the developer under this scheme – as against the normal prevailing market interest rate. A bank loan and registration are compulsory.
Source: JLL India