Noida builders begin cancellation of flats

Ranjit Singh,who bought a flat with Palm Olympia,said,“This is ridiculous and completely against the interests of the buyers. We had protested when we received the demand letter,because of the situation with the banks. They have refused to give us loans because the projects still have not received clearance. I have to give a Rs 3 lakh additional instalment. Where will I get the money? I will go to the site tomorrow to see what can be done.”

Confederation of Real Estate Developers’ Associations of India (CREDAI),a body of private real estate developers,said while most builders had refrained from demanding money,action of all developers could not be controlled.

“When we received complaints of some real estate developers sending out demand letters in the final months of 2011,we asked them to refrain from doing so. While it is inevitable that buyers will have to (bear) increased prices,because of the Allahabad High Court judgment,it should still be done at a later date,” said a CREDAI board member.

In October 2011,the Allahabad High Court had directed a 64 per cent increase in compensation for farmers whose land had been acquired,and an increase in allottment of developed plots from 5 to 10 per cent. The move has left a Rs 4,000-crore burden on the Noida Authority and builders.

Representatives of Palm Olympia and Valencia confirmed that they would cancel allotments if payments were not made.

“While we understand the problem of buyers,we need to raise the money and this is the only way to do it. There are buyers who have applied for plots despite the hike in rates,but we have turned them away because we are completely booked. We stand to lose if buyers don’t pay additional instalments,” said a Palm Olympia official.