Failure in planning appears to have made Rajiv Swagruha scheme unattractive for the urban middle class. Of the 16,000 flats/independent houses constructed by Rajiv Swagruha Corporation, only 4,000 have been sold so far, turning the corporation nonviable.
Now, the state government is planning to auction the unsold flats/houses and also contemplating action against erring officials.
Rajiv Swagruha, founded in 2007, was intended to provide housing for people with moderate incomes in urban areas.
Housing minister N Uttam Kumar Reddy said on Thursday that the government was planning to defer the collection of land cost and tax from Rajiv Swagruha Corporation.
The state government has allotted land to the corporation and also provided loans for taking up house construction.
However, Uttam Kumar Reddy, made it clear that the corporation would not be scrapped. “We are thinking of how to bail out the corporation,” the minister said.
The housing minister said selection of location was one of the main reasons for not getting good response for the housing scheme.
The Jawaharnagar housing scheme in Hyderabad is very close to a dumping yard. It is said the foul smell emanating from the yard stopped people from buying flats there.
As there is no demand across the state for houses/flats, the corporation shelved several projects and the sites allotted by the government were not utilised. They will be taken back by the government if the corporation is unable to take up construction activity, the minister said.
The corporation so far spent Rs 1,500 crore on house construction activity and is unable to pay interest on loans.
The construction of houses/flats, where there is demand, would be completed and non-starter projects would be shelved, sources said.
Finance minister Anam Ramanarayana Reddy added that “auction-action” method would be applied to the corporation.