No sign of their dream homes yet

The hydra-effect of the recession is now having repercussions on home-buyers. Investing in real estate — an established ‘safe’ way to sink your life savings — has turned into a luck of the draw with several realtors not living up to their promises. Lakhs of rupees paid as advances are now stuck with construction companies who over-leveraged themselves promising customers “international” residences complete with club houses, pools, community centres and the works.

As many as a thousand buyers at Hill County, flagship project of Maytas Properties Limited, which was part of erstwhile Satyam Group of companies, are the worst victims as the developer failed to complete the project even after receiving complete payments. Most customers trusted the Satyam brand and some have even paid up to Rs 1 crore as the full amount for villas to own their dream home.

Poorna Chandra Rao Pabbati, one of the buyers complains, “Instead of commencing the work, after the Satyam scandal broke, the developers are giving vague and evasive response to the buyers. the government must look into the episode and do justice to all the buyers.”

Customers of other major companies such as Aliens Group and Suchirindia too are getting jittery, though the builders claim that projects are being completed as per schedule. Aliens Group managing director Hari Challa says, “We assure that we will complete Aliens space station-1 by September, 2011, which was clearly mentioned in the agreement copy. Work has been going on in full swing as we have already sold 75 per cent of flats. A few recession-hit clients even asked us to return their money, and we’ve done that promptly.”
But it’s not just the big timers who have been affected. Several small time builders in smaller townships who attracted customers with their colourful brochures and tall promises are absconding now. “We paid Rs 5 lakh to the builder of Sai Nilayam. He is evading all the buyers and has switched off his mobile phone,” says an irate buyer Devata Srinivasa Rao.

Buyers of government owned Rajiv Swagruha Corporation too are up in arms against the officials as they have not only failed to deliver the houses but are also unable to return deposits, though the project was launched in March 2007. “I paid Rs 2.42 lakh as first installment for a house under the Swagruha scheme. They cancelled the allotment and did not return my money,” says Mayura Rathi, an investor.

Good news though is that consumers who feel shortchanged can do more than just crib. There are several statutes in place to protect the interests of realty investors. For instance, if the construction is postponed due to bad weather or lack of permissions, customers are eligible for receiving a rent of Rs 3 to 5 per sft. AP High Court, senior advocate N. Ramachander Rao says, “Customers can approach the consumer forum if the builder does not respond properly. They can demand a refund of the advance paid with an interest from the builder if the project is delayed.”

It’s advisable to know the compensation clauses and rules to avoid falling into builders’ trap, he adds.



Courtesy:Deccan Chronicle