REAL ESTATE AFFAIR
Debt,
broken
dreams
Half a million unfinished
apartments are stuck
in financial limbo in
India, dashing the dreams and the
spending of a middle class that was
supposed to be spearheading India’s
economic rise.
Wish Town, a development in
the New Delhi suburb of Noida,
encapsulates the plight of middleclass
Indians who sank their life
savings into the promise of life in
a green and neatly ordered suburb.
Hundreds of empty townhouses
and apartment towers, half-built
and stained by mold from monsoon
rains, stare down at what used to be
farm lands.
The excess of unfinished
apartments has particularly affected
India's capital.
Number of apartments delayed
more than three years by city
The construction workers are
long gone, the site’s cement factory
and cranes have stopped working.
Signs mark aborted projects: a
“Sports Field” is still a cauliflower
patch, the “Social Club” a shell of a
building.
Construction stopped in 2016
when the developer couldn’t pay its
debt. Only about half of the 40,000
apartments that were to house
close to 200,000 people have been
finished and handed over to their
buyers. Those who have moved in
complain that the golf club, gyms,
pools, retail spaces and restaurants
advertised by its developer, Jaypee
Group have largely yet to be built.
Jonaki Ray took a loan to buy
an apartment in 2009 that has tied
up her life savings for more than a
decade. To pay for her mortgage,
and an apartment she has rented
in the meantime, she stopped
splurging on things like vacations
abroad and a new car.
Ms. Ray has finally been given
the keys to the unit, but still has no
plans to move in. She has to finish
the interiors on her own, and she is
worried about safety as no one else
on her floor has moved in.
“There is this thing looming over
me and I don’t know what is going
to happen,” she said. “It’s always
there at the back of my head.”
Stuck home buyers in the
hundreds of “ghost towns” now
dotting the outlying areas of New
Delhi, Mumbai and other urban
centers face a situation that some
here liken to America’s much larger
subprime crisis. Builders have
run out of money and can’t get
new loans. People who put down
payments have waited through years
of delays and court cases and still
may not ever get their homes or
refunds.
28 February 2020 | www.smartgovernance.in