A total of 644 housing projects have been prohibited by Maharashtra Real Estate Regulatory Authority (MahaRERA). The reason stated for prohibition has been delayed completion and handover. There are 30% such projects prohibited in Pune because of the reasons of delayed handover and completion.
According to the released data, besides few projects by reputed developers in the region, most of the developers of the blacklisted projects are smaller players with fewer than 100 units per project. There are on an average 70 units in 85% of the blacklisted project. Such blacklisting indicates that the project cannot be marketed, sold, or advertised in any way.
A few projects by Maharashtra Housing and Area Development Authority (MHADA) are also named in the list.
As per the market report, 80% of the units in the 644 projects have been sold. According to the MahaRERA data, about 16 percent of the projects were scheduled to be completed in 2017, while the rest were supposed to be finished in 2018. Mumbai topped the list of blacklisted projects with 274 projects, which account for 43% of the total. Pune follows Mumbai at 29%. Whereas, the rest of the projects are in smaller markets, that include Kolhapur, Nashik, Nagpur, Aurangabad and others.
This move is a significant step taken in the direction to send out a message to errant developers, who have been delaying the projects since a long time. There are at least 496 and 171 projects stuck in the Mumbai Metropolitan Region and Pune respectively.
As per one of the real estate developers of the region, smaller developers are facing several challenges in meeting the RERA compliance such as proof of capital and due diligence for land, with banks, NBFCs and housing finance firms are often unwilling to lend capital to such players because of the fear of low or insufficient securitisation.