Builders under pressure to repay loan instalments

Slack demand amid pandemic forces many to cut prices

Amidst the second wave of COVID-19 pandemic, builders are worried whether they will be able to pay at least the interest on the loans taken by them. Many of them, industry sources say, are selling away the apartments at cost price or with meagre margins to pay the loan instalments. Industry sources say that banks had liberally sanctioned loans and many construction projects took off between Vijayawada and Guntur in a grandiose manner as there was a good response from buyers. The sentiment, however, nosedived with the government announcing its plans to shift the Capital. The projects were high-end and big with 200 to 600 flats per venture in the price range of ₹60-80 lakh per unit. According to a rough estimate, loans to the tune of ₹2,000 crore were sanctioned by banks with a repayment tenure of 15, 18 and 24 months.