Chennai builders lose Rs 30,000 cr due to flood
Chennai: The rain accompanied by floods that ravaged the city and its suburbs during November and December has caused the builders to suffer a staggering loss of around Rs 30,000 crore, it is estimated.
Though the water has receded from almost all areas, the fear it left remains indelible in the minds of people refusing to buy completed apartments on OMR (Rajiv Gandhi Salai), Bengaluru highway and ECR. Before the rains, these places were considered to be the paradise of builders.
It is said that more than one lakh apartments are at the risk of not being sold. 'Various offers are being given by builders to attract customers, but people are refusing to buy flats from the affected places,' said a top official with a leading real estate company in south Chennai. The cost of a flat in these areas starts from Rs 25 lakh and goes up to Rs three crore.
'Most of the builders get loan from banks to implement their projects. As apartments are not selling, it may be difficult for the builders to repay their debts. This will have a huge impact on the industry,' said a realtor at Tambaram.
Builders say people are now scared to buy homes in the rain-hit areas and it will take some time for their minds to change. 'Most parts of the city and suburbs were submerged in water except one or two areas. So there is nothing called safe place. People should think about this,' they feel.
'It is also difficult to understand the mindset of the buyers as people usually don't buy houses during Margazhi. It is more like a wait and watch game now.' Talking about the loss they had to face, a builder said, 'for more than a year or so the business has been dull and the rains have just added to the injury.'
He also said that as far as he knows no concession is given by the banks for builders who are unable to pay their debts due to the rains. Bankers on their part say that different banks are giving various concessions for late payments by builders.