Thursday, May 7, 2009

Buyers Pressurize Govt for Price Cut

The economic slowdown has compelled people to pressurize government to bring down the real estate prices. Around 225 Mumbaikars who have booked 2-BHK flats in a residential scheme named ‘Celebration’ by the City and Industrial Development Corporation (CIDCO) threatens to withdraw from the project in case of non-fulfillment of their demand. These people demand to reduce the rates by 35-45% and it is viewed as the first such mass move in the entire Mumbai region that put pressure on the government to bring down the real estate prices. As a result if CIDCO administration slashes the rates, many other private developers in the region would also revise down their rate. This will thereby benefit the consumers who are looking forward to buy a house.

Under the Celebration scheme, there are a total 532 2-BHK flats and 465 1-BHK flats for which the construction work is under process. People have booked the flats at Rs 3,450 per sq ft but they want these rates to come down to Rs 2,245 per sq ft. An association of 220 buyers who appealed to the CIDCO officials said, “Due to the global economic downturn, the real estate market prices have come down by 35-40% as GDP has fallen from 9% to 5.3%. Similarly, the cost of construction material like cement and steel has come down with city developers slashing property rates by 35-40%.” Meanwhile N C Upase, who has booked a 2-BHK flat, said: “Recently in our meeting at Dhruv hall in Dadar, we decided to withdraw our bookings as the last resort if the CIDCO pays no heed to our demands.”

The buyers association also said that CIDCO had finalized the rates when the market rates were high. “Though we are categorised as higher income group, we would like to express that the economy has hit us hard and are now feeling the cost of the house as an enormous burden,” said the buyers-under the banner of Celebration Action Committee. Further Upase said that even the finance ministry had appealed to the developers to cut the real estate prices in order to boost up the economy. So CIDCO is expected to follow the same, he said. However joint MD of CIDCO, Dilip Jadhav said that the reduction was not possible at the moment. “With the help of financial consultants and economists, we will have to scientifically evaluate the pricing policy for the scheme and only then can the CIDCO board decide on the matter,” he added. If the buyers withdraw from the project then the first installment of Rs 4.5 lakh paid would be forfeited.

News Courtesy : Indianrealitynews