Over 4,800 Pune flats on list of lapsed projects; buyers advised caution

The top five cities with the highest number of lapsed projects are in the Mumbai Metropolitan Region (145 projects with 9,236 units, of which 5,983 are sold), followed by Pune (92 projects with 4,852 units, of which 2,488 are sold), Aurangabad (27 projects with 1,116 units, of which 254 are sold) Nagpur (23 projects of 1,392 units of which 777 are sold) and Satara (23 projects with 1,664 units, of which 661 are sold).

Once a project is deemed to have lapsed, banks will not finance it and owners will find it difficult to mortgage or sell their properties.

Santhosh Kumar, vice-chairman of ANAROCK, said there could be a variety of reasons for the projects being deemed lapsed. “RERA was implemented in 2017, and a year later the Infrastructure Leasing & Financial Services (a non-banking financial company) crisis held real estate—particularly the residential segment—hostage. NBFCs were a major funding source for the real estate industry with banks reluctant due to rising non-performing assets. NBFC funding slowed down significantly with the IL&FS crisis,” he said. Also, private equity funds would have developed cold feet about financing projects, which would have hit Group B and C developers more, he added.

“Fortunately, government-backed funds are now identifying projects nearing completion and are providing last-mile funding,” said Kumar. “Also, some of the larger developers are taking over and reviving smaller projects,” he said. Kumar also urged buyers to check the MahaRera website before buying a flat.