65% Buyers Defaulting In Payments For Under-construction Projects:ICC
New Delhi: Real estate developers are starring at major cash crunch as about 65 percent home buyers are defaulting in payments of EMIs for under-construction projects amid corona virus-led lockdown.
The sector has seen a significant drop in sales and there is no clarity when things will improve and around 65 percent of the home buyers defaulting in payments is a worrisome situations, according Indian Chamber of Commerce (ICC).
“The real estate sector is worth about USD 12 billon and contributes 5 percent to the GDP has been witnessing a slump in sales since last year. Now it is experiencing almost 65 per cent payment default from customers paying the installments linked to construction,” said ICC Director Rajneesh Shah.
Many buyers are now asking the developers to allow them to defer payments as they are themselves faced with major liquidity challenges amid the lockdown.
ICC anticipates that the defaults by buyers will increase many-fold in the coming months.
ICC has written to the government requesting that the Delayed Payment Act prevalent in the MSME sector should be extended to the realty sector too.