Lop sided Real Estate Governance and the Home Buyers

By: VK Bahuguna

This is the dream of every citizen specially the middle class to own a home. According to Knight Frank a real estate consulting company on an average though 86 % of the people in India have their own house but due to various reasons only 50 % live in their own houses, while 30% live on rent and 13 % live with their parents and the balance around 25 lakhs are homeless. As the urbanization is rapidly increasing so is the migration of people and therefore, the pattern of house ownership in India varies significantly between rural and urban areas. As against 95% in rural areas, around 69% of the total households in India own houses. Therefore, as the economy grew and job prospects in private sector increased manifold compared to what it was in early seventies, there was real estate boom in metro and other mid size cities and towns especially in Delhi and NCR. To promote housing and planned city life special urban bodies were created in the form of development authorities by the state governments.

In the NCR region the Noida and Greater NOIDA authorities were created and with this started the mushrooming business of real estate builders who became rich overnight with the patronage of state politicians and corruption of officials as both took advantage of the ambitions of the middle class people residing in NOIDA and NCR areas. NOIDA being nearer to Delhi and with an open air ambience and clean Ganga water people aspired to buy their sweet home in NOIDA. The Greater NOIDA was fast developing into a modern open city with all facilities. Previously the state governments used to provide land as concessional rates to the cooperative group housing societies of different sections of people and people used to get affordable houses and flats. However, due to involvement of many politicians and businessmen as builders the nexus of politico-bureaucratic with these so call authorities killed the idea of housing societies and came up the idea of promoting professional builders under the grab of professionalizing the real estate sector. This was followed up by putting the residential plots to auction or allocated at a very premium rates to builders. It also fattened the revenue of these authorities and on the other hand allowed builders to mushroom fast who garnered huge response in NOIDA.

During 2008 to 2014 any tom dick and harry could become a builder in NOIDA by paying Rs Ten Lakh and get a residential plot in connivance with NOIDA authority big wigs and political mentors. He will then float advertisement and get people to register for flats and from that proceeds will get another such plot. This is the way the Amrapali promoter fleeced more than 45,000 home buyers in NOIDA and NOIDA extension. The owner of Amrapali initially constructed good flats but his avarice and ambition to become a politician in Bihar bribed politicians to become a Member of Parliament and squandered people’s hard earned money in super lavish life style. These thugs had no brains to use the money pragmatically and ultimately the constructions of flats stopped.

Seeing the precarious condition one young professional flat buyer Amit Gupta with a few of his friend found a very helpful senior advocate of Supreme Court in Mr Lahoty and filed a write in Supreme Court against the Amrapali builders. Thankfully the Supreme Court constituted a Bench and started hearing the case because the state Government totally abdicated its responsibility and left the flat buyers at the mercy of real estate thugs. The Supreme Court in one of the finest interventions in support of middle class home buyers put Amrapali promoter in jail and appointed a senior advocate Mr R Venkatramani as Receiver to oversee the completion of Amrapali housing projects with the help a few banks and National Building Construction Corporation (NBCC) to complete the Amrapali projects. The Court has ordered auction of Amrapali properties, sale of unsold flats and the flats of Ghost buyers but the system is so convoluted that the receiver is not able to get sufficient funds from the Amrapali properties to complete the project.

The Receiver has put forth a proposal in the Supreme Court earlier this month to identify vacant land in each project and prepare a layout plan without obtaining NOCs from the buyers and register them under RERA to garner funds by allowing the builders to develop and sell flats by twiddling with green areas and common areas. It is not a simple affair and if implemented would be grave injustice to the home buyers as well as the environment. Already the NOIDA Extension is so much crowded that break down in civil amenities is a routine affair and it is going to turn soon a slum like seen in Nalasupara area of Mumbai. The situation is this because the state government officials had miserably failed to implement its policy on land allotment and enforcement of building by-laws in connivance of builders and have been constantly changing the Floor Area Ratio (FAR) violating the Master Plan. The common facilities like, green area, market, parks, community centre, transport hospitals are essential element of a city life. If the FAR is changed it will convert a project like Centurian Park where more than 45,000 people will be living in 9000 units into a veritable concrete jungle.  More than 150 flat buyers in a meeting had strongly opposed this on the ground that this recommendation goes against the spirit of Supreme Court intervention and is against the by-laws of the NOIDA authority and the fact that the buyers have the first right over such land. The NOIDA authority as well as Supreme Court should strictly adhere to the by-laws of the authority and should take action in the true spirit of Supreme Court intervention so that projects are completed.

It would be worthwhile to mention that the UP government should devise a people friendly housing policy and the first step in this direction is to scrap all these authorities forthwith.

(The writer is Chairman of Centre for Resource Management & Environment)