One in five under-construction homes, totalling over 500,000 units, remain undelivered due to stalled projects across 44 cities over the past eight years, according to data from analytics firm PropEquity. The data reveals that 1,981 projects are stalled, with the remaining units delivered only after significant delays of 3 to 4 years.
The number of stalled units has increased to 508,202, up about 9% from 465,555 units in 2018. The report details 1,636 stalled projects in 14 tier I cities, accounting for 431,946 units, and 345 stalled projects in 28 tier II cities, totalling 76,256 units. Greater Noida leads the tier I cities with 74,645 stalled units, while Bhiwadi tops the tier II cities with 13,393 stalled units, according to the report by NSE-listed firm.
Among tier I cities, Greater Noida has the highest proportion of stalled units at 17%, followed by Thane with 13% and Gurugram with 12%. Mumbai has the most stalled projects at 234, with Bengaluru and Thane following at 225 and 186, respectively.
Samir Jasuja, Founder and CEO of PropEquity, attributed the rise in stalled projects to developers’ execution failures, cash flow mismanagement, and diversion of funds. He emphasized the need for independent audits to help homebuyers assess developers’ capabilities.
Jasuja said, “Real estate disputes in various courts have been rising. To add to this, the backlog of stalled projects and the addition of new ones have put the onus on homebuyers to do their due diligence through professional experts before buying a house.”
In response to the issue, the government launched the Special Window for Affordable and Mid-Income Housing (SWAMIH) Fund in November 2019, raising Rs 15,530 crore to complete stalled projects. However, only about 32,000 units have been finished in the past five years. The Fund aims to deliver 20,000 homes annually over the next three years.
The situation is similarly dire in tier II cities, with Bhiwadi having the largest share of stalled units at 18%, followed by Lucknow and Jaipur with 17% and 13%, respectively. Lucknow leads with the most stalled projects at 48, followed by Jaipur and Bhiwadi with 37 and 33 projects, respectively.