HMDA finds it tough to sell its land in city

HMDA finds it tough to sell its land in city
June 29th, 2010
DC Correspondent
Hyderabad, June 27: The Hyderabad Metropolitan Development Authority (HMDA), which was an elite brand name in the national real estate sector until just a few years ago, is now struggling to sell even small plots in and around Hyderabad.
To boost sales and attract prospective buyers, the HMDA is now offering people who buy plots bank loans, that too, at a lower rate of interest than the prevailing rate of interest being offered by other banks.
The HMDA has tied up with HUDCO, which will provide loans at an eight per cent interest rate.
The loan can be obtained either for purchase of land or for the construction of a house on the land. As many as 229 plots of various sizes, ranging between 250 sq yards and 2,000 sq yards will be put up for auction through e-bidding on July 12. Plots are available at Asifnagar, Miyapur, Mushk Mahal near Attapur, Nallagandla, Nandagiri Hills, Ramachandrapuram and Tellapur; the last date for submission of tenders is July 9.
The finance advisor of the HMDA, Mr G.K. Rao, said that the rate of interest from HUDCO will be at eight per cent for the first three years and thereafter; it will be on a floating basis. This is on lower side as other banks like even the SBI are offering home loans at over eight per cent for only first one year, after which it is on a floating basis. “It’s like a double bonanza to the prospective buyers with lower interest rate on one side and a clear title of land on the other,” said Mr Rao.
He also said that even the offset prices have been brought down as per the market value. However, builders and those wanting to buy smaller plots disagree with the HMDA. They said that the offset price, which is Rs 10,000 per sq yard for a majority of the plots, is expensive.