Preference given to buyers who made 100% payment

by Suresh Perera

In what was described as “shocking official apathy”, prospective buyers of Sea View Residencies at Lunawa complained that they have been left out in the cold despite making the 25% down-payment plus other “related charges” five months ago to procure a flat.

The 356-unit housing complex was developed by the Urban Settlement Development Authority (USDA) targeting “low and middle income families”, but in what appears to be a mix-up in priorities, those who had the financial strength to make 100% payment upfront were given preference, they asserted.

Applicants who settled the full payment on outright purchases have already moved into occupation, while those who made the required 25% down-payment five to six months ago are still left kicking their heels until a monthly repayment plan on the balance due is worked out by the USDA with a financial institution, they said.

“I made a down-payment of one million rupees plus an additional Rs. 140,000 as “related charges” to acquire a unit under a price range of Rs. 4.56 million to Rs. 5.58 million each. Despite the payment made in February 2021, there’s still no word of the promised repayment scheme being finalized so that I can occupy the flat”, a prospective buyer said.

Apart from the standard “we will get back to you soon” response from a USDA officer handling the project, there’s still no hope of occupying the flat, he noted.

“It’s a double whammy because for the past five months, I have to pay rent on the house I am occupying in addition to servicing the bank facility raised to make the one million rupee down-payment”, he further said.

“It’s so convenient for them to blame their lackadaisical attitude on Covid-19 when they had two full months to sort out the matter before the pandemic situation worsened”, he pointed out.

Even during the travel restrictions in the Western province in May, banks were operational and government officers were supposed to ‘work from home’. However, it appears that USDA officials handling the housing project had been twiddling their thumbs without pushing through the repayment plan, he continued.

He said that it’s a joke to call Sea View Residencies a housing project for “low and middle income families” when those who had the financial capacity to make 100% payment upfront are already occupying the flats, while lesser beings continue to be pushed around.

“That’s correct, we have already given the units to those who have made the payment in full”, says USDA’s Chairman, M. L. Subasinghe Arachchi.

He said the 100% payment factor was based on a Cabinet decision.

Asked about “low and middle income families” who have made the down-payment, but are still kept waiting, he replied, “they can arrange a bank loan, and if necessary, we can give a letter to facilitate it”.

“If we had the collateral to raise millions of rupees as a loan from a financial institution, we wouldn’t have opted for a flat meant for low income families”, a prospective buyer protested.

A USDA officer familiar with the subject said a scheme to work out a monthly repayment facility on behalf of the considerable segment of prospective buyers who had made the 25% down-payment has been forwarded to HDFC Bank.

“We have to submit the deed of the land certified by the Land Registry to finalize the process”, he further said.

“When I made inquiries about the inordinate delay, I was told that the Land Registry had earlier rejected the application because Lunawa (Moratuwa) had been identified by a USDA officer as an area within the purview of ‘Southern Province’ instead of Western Province”, the buyer claimed.

“With such ‘competent’ people around, I cannot imagine how much longer we will be kept waiting to take possession of our flats”, he laughed.

“Anyway, we hope to sort out matters within the next two weeks”, the officer assured.

He admitted that the general practice earlier when selling units in housing complexes specifically meant for low income families was for the government institution concerned to arrange a feasible credit facility through a government financial institution on reasonable interest.

Application forms were initially issued to interested buyers on a non-refundable deposit of Rs. 2,000 each. After shortlisting applicants, interviews were called, where they were assured that after the 25% down-payment on the total value of each unit was made, a credit facility would be arranged through the Bank of Ceylon under a monthly repayment plan at 6.25% per annum.

The applicants were shortlisted on the basis of a monthly household income of Rs. 75,000. The availability of a bank facility was also clearly outlined in letters sent to buyers shortlisted as “eligible applicants” to purchase the flats.

Asked why buyers who made the full payment were given preference, while low income families who sought a repayment plan have been kept waiting for more than five months, the officer explained that some issues that cropped up had to be ironed out.