Cash crunch delays Hyd's pre-launch projects

Weak sales force some developers to delay towers, shift buyers and offer refunds.

Property Pulse

Homebuyers who booked apartments in Hyderabad's pre-launch projects hoping to secure lower prices are facing prolonged uncertainty as slowing sales and tight liquidity disrupt project execution across the city.

Developers who launched projects with plans for three or four residential towers are increasingly finding it difficult to maintain construction schedules because of weaker cash flows. 

Industry sources say the slowdown in housing sales over the past few years has forced several builders to stagger construction, postpone later phases or revise their execution plans.

In some projects, developers have begun consolidating buyers from multiple planned towers into a single tower that is under construction to optimise resources and speed up delivery. 

Buyers unwilling to accept the revised allocation are being offered apartments in other projects, while some developers have agreed to refund booking amounts with interest after a specified period. In a few cases, post-dated cheques have also been issued as an assurance.

Despite these measures, uncertainty persists among many pre-launch buyers. Some fear that if sales fail to recover, construction timelines could slip further, delaying possession and locking up their investments for longer than expected.

Liquidity squeeze

The slowdown has also spread through the construction ecosystem. Contractors and building material suppliers say delayed payments have become more common, prompting many to stop extending credit and instead insist on advance payments. Some vendors have also begun charging interest on overdue dues, adding to developers' financial burden.

Market Impact

• Pre-launch buyers face longer waiting periods.
  
• Some projects have delayed later construction phases.
  
• Buyers shifted to towers under active construction.
  
• Alternative units or refunds offered in select cases.
  
• Vendors tighten credit as payments are delayed.
  
• Recovery in home sales seen as key to restoring cash flow.