Realtors welcome UPRERA extension to real estate projects

The Uttar Pradesh Real Estate Regulatory Authority (UPRERA) has granted a nine-month extension to projects in the National Capital Region (NCR) whose original or extended registration expires on or before December 31, 2021.

Realtors welcome UPRERA extension to real estate projects

The Uttar Pradesh Real Estate Regulatory Authority (UPRERA) has granted a nine-month extension to projects in the National Capital Region (NCR) whose original or extended registration expires on or before December 31, 2021. This extension is conditional on the Authority's careful supervision of such projects; if a project's completion date is later than December 31, 2021, the promoter will be compelled to accelerate development efforts and finish the project within the existing registration term.

Realtors in the National Capital Region have praised the move. “This action would undoubtedly aid the realty sector, which is confronting an unprecedented situation,” says Manoj Gaur, CMD, Gaurs Group, and Vice President – North, CREDAI National. “In the midst of the difficult times that every industry is experiencing, the sector requires assistance. The major players are working hard to accelerate and complete projects on schedule, but the multiple waves have taken their toll. We are doing everything we can to address the price increase and labour shortage. This is a really positive step for UPRERA.”

It should be noted, however, that such an extension would be granted only if the project's promoter applied with an affidavit stating that the project would be completed within the extended registration period, as well as a convincing financial plan to complete the project, either through project finance or from its own resources.

The 2021 lockdown, which was imposed in response to the second wave of the COVID-19 pandemic, has hampered the availability of personnel and raw materials in the real estate industry, in addition to generating a cash shortage. The recent announcement by UPRERA that real estate projects in the NCR and Non-NCR areas will be extended by 9 and 6 months, respectively, is a well-thought-out decision by the authority to ensure seamless execution and completion of the projects, benefiting millions of homebuyers. However, we hope that the UPRERA approves a general extension, similar to the previous wave, rather than a conditional extension so that more projects in the state can benefit. Also, the authority's monitoring circumstances must be liberalised to make compliance easier,” says Siddharth Katyal, Director (Planning & Strategy), Omaxe Ltd.

In response to the pandemic, the Authority has granted a second extension for project completion dates. During the first wave last year, it had given a six-month extension. “COVID-19 has had a detrimental influence on building activity, thus it would be advantageous to developers. It would provide projects with some breathing room as they restarted operations one by one. As projects have to cope with difficulties like labour availability and supply chain challenges, it will help smooth out operations,” says Amit Modi, Director, ABA Corp & President (elect), CREDAI Western UP.

If the promoter is unable to finish the project during the extended registration time, it will be required to sign an MoU with the Association of Allottees (AOA) and submit an application to the Authority for additional time.

Immediate corrective action is necessary to avert a catastrophic collapse of the real estate sector as a result of COVID-19. The major aim in the current scenario is to resolve homebuyer concerns by giving appropriate regulatory relief to real estate developments, resulting in a win-win outcome for all parties involved. It would enable developers to finish projects on schedule, allowing purchasers to acquire their reserved houses within the revised timeline,” says Harvinder Singh Sikka, MD, Sikka Group.

Source: Financial Express