HMDA land auction remains a flop show

Disadvantages of HMDA Plot auctions!

Usually, whenever the HMDA lands are auctioned, both domestic and foreign buyers flock these auctions. Most of them prefer to buy these lands without hesitating to offer a higher price than the market rates, due to the sole reason that these lands will not have any legal entanglements. However, this time the scene has reversed. The HMDA land auction did not receive rather poor response and the plots could not be sold as planned. Though some media outlets are claiming the land auction a grand success, the reality seems to be far from truth.

HMDA auctioned 38 plots in premie locations spread across three districts. However, only nine plot were sold out i.e. only 25 percent of the plots have been sold, despite much hype. It is evident that buyers were not keen to buy these plots. The highest price at which a plot was sold was Rs 1.10 lakh per sq.yard, according to a release issued by HMDA. However, the advertisement does not mention the location/ area of the plot, who bought it, the actual price of the plot and how much it was sold for. It is known that when plots were sold in Kokapet Neopolis auction in the past, the HMDA authorities have clearly stated details including which company bought how many acres and at what rate. But, the details are now not being shared.

Interestingly, in the auction conducted by HMDA, the minimum price for a plot in an area like Kokapet was fixed at Rs 1.1 lakh per sq.yard. While the price was Rs 1.5 lakh per sq.yard in Nallagandla, there is no clarity on whether the newly sold plots at Rs 1.1 lakh per sq.yard, are from this location or any other location. Earlier, buyers did not show interest to purchase plots in the most sought after locations like Kokapet when price was fixed at Rs 1.5 lakh per sq.yard. The authorities are yet to reveal whether these plots could not be sold due to high pricing or any other reasons.

Due to the looming threat of economic recession and skyrocketing land prices, it is clear that NRIs are not showing much interest in buying plots. Even though some realty research agencies have been trumpeting that the market is doing well, the buyers are not responding positively. Further, people are ready to purchase plots in HMDA layouts only if they are demarcated properly and do not have any zigzag shapes. Further, the officials are simply ignoring requests from the buyers if they notice any problem in the respective plots after purchasing.