Jaxay Shah, President, CREDAI
There has been a long standing call for a regulation like RERA, both from the industry as well as consumers. The purpose of such a regulation would be to build equity amongst the stakeholders, create accountability, promote delivery-driven project execution and facilitate financial and administrative transparency.
The present RERA requirements fulfil all these needs. Though the compliance burden is heavy, the Act has provided the right impetus to ensure that all due diligence which consumers may require are fulfilled. This will go a long way in restoring consumer faith in the real estate sector.
Despite the initial setbacks, the Act has come into effect from May 1, 2017. However, most States have not been able to implement it immediately and are in the process of doing so. Yet, both consumers and developers need to look at it optimistically. There will be teething problems, but as the regulatory mechanism sets in place, we will see a smoother transition into the new administration.
We want people to take it positively. Don’t fall prey to false assumptions, for they will only serve as a hindrance to sincere growth. Moving towards the common goal of building a professional, accountable, transparent and innovative sector should be the objective of all stakeholders.
Shishir Baijal, CMD, Knight Frank India
The unorganised world of broking in India would see a new paradigm with the implementation of the Real Estate (Regulation and Development) Act 2016. From being merely a facilitator between buyers and sellers, brokers will now have to adopt a bigger advisory role attached with responsibility for projects and disclosures. The survival of broking firms will depend on how they inculcate a corporate culture in dealing with both the stakeholders. It is good that brokers have been brought within the ambit of RERA and any deviation would invite penal actions. Although there would be teething problems, the move will see the emergence of a new consolidated broking fraternity.
Anshul Jain, MD, India, Cushman and Wakefield
The on-ground implementation of the Real Estate Regulatory Authority (RERA) law is the single biggest reform which will inspire the much needed trust in the sector. This would boost investments from consumers and private and institutional investors. The act will bring almost 83,000 registered builders in India under its purview to ensure that the interest of home buyers are protected. Better regulation and accountability will spur investments from foreign and domestic financial institutions and will bolster longer term potential on real estate investments.
RERA’s focus on mandating disclosure of projects, including details of the promoter, project, land status, clearances, approvals etc., and the timely delivery of projects will help increase the credibility of developers as well. As for penalty, both homebuyers and developers will be penalised for delays in payment and completion of projects respectively. The act also mandates the developers to deposit 70% of the project cost in a separate bank account to cover project development activity.
Rohit Gera, VP, CREDAI – Pune Metro
For decades there have been no barriers to entry to the industry and absolutely no performance parameters. The risks of delayed delivery, poor quality of construction, changes in the final product from what was promised, sales made without permits, and developers running out of money on account of fiscal indiscipline used to be borne by the flat purchaser. With the introduction of RERA, these risks will now all be borne by the developer. The increased costs associated with these risks will eventually be transferred to the end consumer through an increase in prices. With the introduction of RERA the first step of consumer protection is now completed. The next step however is to eliminate corruption in the sector which will help bring more homes to the consumer at a lower price at a faster pace.