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Real estate projects may get 9-month extension

JULY 24, 2020

NEW DELHI: All real estate projects that had a scheduled completion date on or after March 25 will get six months extension and real estate regulators (RERA) will have the discretion of allowing another three months leeway considering local conditions.

This would save most ongoing projects from going into default due to delay in completion because of total work stoppage during the lockdown. The government said this will also protect the interest of homebuyers as they will get the property, though delayed by six months.

The move is significant as there were several projects that were nearing completion and the announcement of new ones in the months prior to lockdown had given a glimmer of hope to the stressed sector. The presence of well reputed companies in the more recent announcements was seen as encouraging before the pandemic hit the fragile sector hard.

Minutes after finance minister Nirmala Sitharaman announced relief for the Covid-hit real estate sector, the housing and urban affairs ministry issued an advisory to all real estate regulators and state governments to invoke “force majeure” to treat the pandemic as an “act of God” and suo motu extend the deadline of projects that were scheduled for completion after March 25.

So far, RERA authorities in Maharashtra, Gujarat, Uttar Pradesh and Tamil Nadu have given extensions for completion of projects registered under the law by 3-5 months. “Since there are over 50,000 registered projects, it was felt that submission and processing of each application for extending the timeline won’t be feasible. So, now there will be one order for all projects to get this extension,” said a housing ministry official.

Source : Times of India.