Liquidity crisis post NBFC crisis of 2018 has already taken its toll on Indian real estate sector in the form of delays in completion of flats and stalled projects and the outbreak of COVID-19 and subsequent lockdown have only aggravated the situation. According to a report Anarock Property Consultants, around 4.66 lakh units across seven major cities, which were scheduled to be delivered by the end of 2020 may now miss the deadline.
“If not for COVID-19, the top seven cities were to see the delivery of nearly 4.66 lakh units by 2020-end. Launched after 2013, many of the projects were on the final leg of completion. With almost zero construction activity in the last few months due to the lockdown, the completion deadlines for almost all these projects have got extended,” the report says.
The National Capital Region (NCR) and the Mumbai Metropolitan Region (MMR) have over one lakh units each lined up for delivery in 2020, according to the report. Before the pandemic struck India, Pune had 68,800 units lined up for completion in 2020, Kolkata had 33,850 units and Hyderabad had nearly 30,500 units to be completed during the year. Chennai had least pending delivery at around 24,650 units. Meanwhile, most of the state RERAs have given the developers a six-month extension on deadlines, making homebuyers’ wait even longer.
In the post lockdown developers are encountering a new problem in the form shortage of construction labour. Maximum completions were to happen in the NCR during 2020 and 2021 and this region is set to witness more project delays, over and above the backlog of over two lakh units already delayed in the region from before. “Unless labour shortage is addressed immediately, project deliveries will stutter going forward,” the report says.