Tag: rera-india

Across the nation, the speed of implementation and extent to which RERA has noticeably impacted real estate varies, but the positivity it brings in is not in doubt.

For an industry that provides a basic need of shelter, regulation has come as a value-add. After years of differences in opinion as regards norms, terms and conditions, the Real Estate (Regulation and Development) Act (RERA), 2016, created a broad set of guidelines which brought in transparency in real estate transactions as also defined responsibilities of stakeholders in general and real estate developers in particular.

Across the nation, the speed of implementation and extent to which RERA has noticeably impacted real estate varies, but the positivity it brings in is not in doubt. There is need for an equal implementation across the nation with minor tweaks and changes to make what is accepted as ‘good’ to evolve into ‘better’ – and even, ‘best’.

RERA’s prime focus at the time of introduction as being ensuring protection of consumers’ interests, by bringing in policies that defined the extent as also apportioned responsibility on the part of real estate developers. Leveraging information technology, RERA enabled access to sanctioned plans as also details of different stages of construction. For customers, RERA has brought in an era of transparency through proper disclosure and financial discipline.

At the time it was introduced, this path-breaking regulatory regime provided for tribunals and ombudsman for redressing disputes. RERA also provided real estate developers with protection from defaulting buyers and ensured what we could refer to as an element of fair play.

In Maharashtra, easily the poster-boy of successful implementation of RERA across the nation, there has been an additional layer added to the process in the form of a redressal forum, which seeks to provide an option prior to actually filing a dispute before MahaRERA. This has proven to be a success, with a success rate of over 60 per cent.

This is the biggest take-away from the two-and-a-half years of RERA implantation across the nation. The regulatory aspect can be strengthened with redressal prior to taking up due process under the regulatory regime. In terms of different states having different set of market functioning – leading to different levels of implementation across states – needs to be streamlined into a single, functional regulatory regime that helps the industry grow in an environment of transparency and accountability on the part of stakeholders.

Projects which are in existence prior to implementation of RERA need to be assimilated within the system, or a parallel system which ensures that all real estate projects are brought under regulatory regime. Similarly, in some states where implementation is not at the level it should be, we see new real estate projects slipping through the regulatory net. It is similar to the challenge of GST and real estate: uniform implementation across different states is needed. Going into the future, RERA needs to address the issue of lack of uniformity in laws and capabilities of different state’s RERA authorities.

In some states, we see that for projects under construction, data is being collected – but not being analysed or shared with all stakeholders. Information technology needs to be leveraged, so that data is analysed; numbers are crunched – and the results are acted upon in the form of guidelines or new norms as would increase the positive effect of RERA.

We also have a situation in some states where implementation is not at the levels we would have expected. The problem here is the lack of informative and user-friendly on-line access for home buyers. So, we see in some states that periodic updates on part of the developers and also about some on-going projects are not available online.

Ideally, the huge quantum of data already collected by regulatory authorities across states should be analyzed efficiently and made available in simple to understand formats to stakeholders – especially home buyers – so that they are well informed and updated about the general scenario in their state’s real estate. The aspect of ‘information’ and of it reaching those for whom the regulatory regime sought to make these available is something that needs to be expedited in such states.

To sum up, the journey so far under the RERA regime has been good, but we need to tweak it to ensure it evolves through ‘better’ to ‘best’.

Source: https://www.financialexpress.com/money/rera-a-game-changing-regulation-marred-by-patchy-implementation/1825108/

The number of stuck projects is huge and reasons are mostly related to the liquidity problem and financial crunch. In such a scenario the best solution is to give them to the developers who have a good record so far.

Real estate developers in Delhi-NCR are sensing business opportunity in completing over two lakh flats that have not been completed and some are taking over stuck projects, rebranding them to sell these unsold apartments at a premium.

Noida’s ATS Group has formed a separate company, ATS Nirman, and has already taken over three stalled projects and is in line to take over more. The business has a potential of Rs 30,000 crore in next five years, said Getamber Anand, CMD of ATS Group. The company takes over projects through the Real Estate Regulatory Authority (RERA) as they need to be deregistered first, he said.

“We are not calling it a project management consultancy but a project revival consultancy,” Anand said. “With ATS branding and assurance, the existing customers’ trust is gained.”

Ashish Sarin, CEO of Gurgaon-based Alpha Corp, said developers are exploring alliances to jointly develop stalled projects through revenue-sharing pacts. “Instead of launching new projects, they are taking over incomplete projects and assuring timely delivery,” he said.

Sarin said stuck projects leading to slowdown in the market is one of the factors contributing to prolonged stress in the real estate industry. “For developers struggling to complete projects, joint ventures or joint developments offer a viable means to overcome financial distress and find synergies,” he said.

As per government estimates, around 458,000 housing units are stuck across more than 1,600 projects in the country.

“It is a good trend as it will help finish the stuck projects faster and helping the buyers get their homes. The projects that were in bad shape were acting as blots on industry, affecting the image of the sector that has good intention of meeting the housing demand of people,” said Manoj Gaur, MD of Noida-based Gaurs Group.

“The number of stuck projects is huge and reasons are mostly related to the liquidity problem and financial crunch. In such a scenario the best solution is to give them to the developers who have a good record so far. The intention should be to hand over the homes to the buyers as soon as possible,” said Deepak Kapoor, director, Gulshan Homz.

Source: https://economictimes.indiatimes.com/wealth/personal-finance-news/hope-for-homebuyers-developers-see-business-in-stuck-projects/articleshow/72901348.cms

New Delhi

The realty law RERA should be amended to plug loopholes and make it more effective for the interest of all stakeholders, according to regulators.

In an event organised by industrychamber PHDCCI, Gurugram RERA Chairman K K Khandelwal asked India Inc to make suggestions to the government for necessary amendments to RERA Act to make it dispassionately objective for both builders and home buyers.

According to Khandelwal, the existing stipulations and provisions of RERA Act have many loopholes that need to be plugged in the interest of all the stakeholders, PHDCCI said in a statement.

“In its current format, several sections and sub-sections including clauses and sub-clauses of the RERA Act are contradictory and therefore, open for many legal interpretations as well interpretations of real estate regulatory authorities of different States and therefore, amendment to them are called for to make sure that all stakeholders in the real estate and construction sector get a fair deal and the intended growth of the sector is ensured,” Khandelwal was quoted as saying.

Balvinder Kumar, Member, UP RERA informed that the UP RERA has so far received 70,000 complaints from various home buyers against builders in the state that have defaulted in their delivery commitments.

Of which 10,100 complaints have been addressed.

Source: https://realty.economictimes.indiatimes.com/news/industry/rera-should-be-amended-to-plug-loopholes-h-rera-chairman/70763340

NEW DELHI

The Centre has planned to set up a common online platform for the Real Estate Regulatory Authority (RERA) of all states and UTs, a move which will provide an opportunity to home-buyers, builders and authorities to exchange views. Announcing the government’s plan here, Housing and Urban Affairs Secretary Durga Shanker Mishra said that with this platform, the real estate law will become “more strong”.

Under the Real Estate (Regulation and Development) Act, 2016, all states are mandated to constitute their respective real estate regulator RERA which provides proper protection to home buyers.

“We are working to introduce a common platform where RERA of all states and Union Territories (UTs) can exchange their views. With this, RERA will be more strong,” he said.

According to the ministry, as per the norms of Pradhan Mantri Awas Yojana (Urban), home-buyers will not be able to avail Credit Linked Subsidy Scheme (CLSS) under the mission if real estate project is not registered under RERA.

Under PMAY (U), home-buyers can avail an interest subsidy of upto 2.67 lakh.

Later, Mishra told reporters that on the online platform, any state RERA can study an order of other states in a particular matter. Also, home-buyers and builders can give their views on this issue.

Giving details about real estate projects on the fourth anniversary of PMAY (U), AMRUT and Smart Cities Mission, the secretary said that till now, over 42,000 projects have been registered under RERA while more than 32,000 real estate agents have been registered.

On his part, Housing and Urban Affairs Minister Hardeep Singh Puri said that wherever the central real estate law has been implemented, it has made a “very big difference”.

RERA is a real estate regulator and it gives an opportunity to home-buyers to register their complaint against builders, Puri also said.

Mishra said that 30 states and UTs have notified RERA, but West Bengal has notified its own real estate regulator – Housing and Industrial Regulation Act, 2017 (HIRA).

In July last year, the ministry had sought the opinion of the Law Ministry over West Bengal notifying its own real estate law instead of implementing the Real Estate (Regulation and Development) Act enacted by Parliament.

Source: https://realty.economictimes.indiatimes.com/news/regulatory/centre-plans-to-set-up-common-online-platform-for-rera-of-all-states-uts/69946101

After 2 years since the onset of RERA, property registrations across the country have risen and buyers are coming forward in large numbers to seek relief from dubious builders.

Property registrations under RERA are increasing continuously. The registrations across the country have increased especially between November 2018 and April 2019. According to Anuj Puri, Chairman of ANAROCK Property Consultants, 307 projects have been registered under RERA in Andhra Pradesh. In November 2018, Andhra Pradesh RERA had recorded only 61 property registrations. Maharashtra leads with more than 20,718 projects registered and 19,699 RERA-registered real estate agents. In the southern state of Karnataka, 2,530 projects have been registered while 1,342 real estate agents have been registered under RERA.

Gujarat boasts of 5,317 RERA-registered projects and 899 registered agents and agencies. After two years since RERA was implemented, the property registrations across the country has been rising. The north-eastern states of Manipur, Meghalaya, Mizoram, Nagaland and Sikkim are soon going to notify RERA rules. The north-eastern states have been earlier reluctant to comply to RERA rules. However, these states are soon going to adopt RERA regulations to increase transparency across the sector. West Bengal has framed its own real estate law under the West Bengal Housing Industry Regulatory Authority (WBHIRA). As of now, 22 states and 6 Union Territories have already implemented RERA. 19 states have active online RERA portals while West Bengal has its own portal.

Anuj Puri said that each of the states with active portals have recorded a rise in project and agent registrations since November 2018. He noted that even while fretting about the dilution of the rules notified, buyers have been bestowing their faith in the law and coming forward in large number to lodge complaints against developers for various reasons including project delays.

MahaRERA has registered 6,631 complaints until April. According to the state authority, 64 percent of the complaints have been disposed. Also, there are cases of developers delaying payments and not attending hearings which need to be resolved. A huge number of consumers are registering complaints across the country which shows the increasing faith in the redressal system among buyers.

Source: www.realtynxt.com/2019/04/30/property-registrations-under-rera-rise-across-the-country

It’s been two years since the deployment of the Real Estate Regulatory Authority (RERA) across India and the Centre’s aim of enforcing it in each state is gathering visible momentum. Even the north-eastern states including Manipur, Meghalaya, Mizoram, Nagaland, and Sikkim – which earlier shied away from it – have agreed to officially notify RERA rules soon. West Bengal is the only state which notified its own real estate law under West Bengal Housing Industry Regulatory Authority (WBHIRA).

Rohit Poddar, Joint Secretary, NAREDCO West and Managing Director, Poddar Housing and Development Ltd. states, “RERA has been a huge success in Maharashtra, the trust gap between the developer and the seller has largely been bridged. RERA has been very quick to address the issues of the developers and giving judgments on the conflicts between the buyer and developers. Reconciliation process through arbitration cell has become faster and convenient for the customers in case of delay in possession, which has consolidated the confidence of the buyers in the market. MahaRERA is the best RERA in India.”

It may be recalled that RERA intended to cover developers as well as real estate agents seamlessly across the country. As it stands now, 22 states and 6 Union Territories have already notified their RERA rules, out of which 19 states have active online portals. West Bengal too has an active portal for its own real estate law.

Manju Yagnik, Vice Chairperson, Nahar Group & Vice President NAREDCO (MAHARASHTRA) – “One of the biggest and most important action in the industry was implementation of RERA. The challenge of bringing it in the ambit of regulation has been a journey that is still progressive in nature as many questions still do not have the answer. However the real estate machinery has changed with this development.”

Things are changing for the better. Generally, players are far more accountable and cannot easily get away with breaking the RERA rules.

“There are ample amount of reasons to celebrate the second year anniversary of the much needed RERA, the implementation of which was envisaged to bring in transparency in the industry, has definitely achieved what it was set out for. Developers today are committed more than ever on the delivery of the projects; it has also brought discipline in the usage of funds. All in all RERA has brought in some positive changes amongst the industry, along with increased accountability, transparency and efficiency.” Rahul Grover, President Sales and Operations at Sai Estate Consultants.

Amit Ruparel, Managing Director, Ruparel Realty on RERA completing 2 years, shares “The Real Estate Regulation & Development Act (RERA) is a landmark legislation poised to catapult the sector into its next phase of growth, laid on the foundation of being transparent, competitive, hassle-free and consumer-centric, which certainly benefits corporate developers like us and most importantly the home buyers.”

Source: www.realtyplusmag.com/rera-turns-two

One of the biggest, and arguably the most called for, reforms in real estate industry in India was the implementation of RERA nearly 2 years ago. While the debate had been on for nearly a decade on regulating the highly opaque industry, the challenges of bringing it within the ambit of regulation were multi-fold. Let alone the reluctance on part of the key players, the overall machinery to manage the process was fraught with numerous challenges.

In the backdrop of a regime change at the centre in 2014, which placed its bets on ‘Housing for All’, among other things like urbanization-themed ‘Smart Cities Mission’, it became imperative for the industry to bring itself under the ambit of regulation. Moreover, it had long been understood that unless there was proper consumer protection and close monitoring of processes and practices, it was not possible for organised funding to take deeper positions in the industry.

Eventually, Real Estate (Regulation & Development) Act 2016 took shape paving the way for establishing regulators at the centre, and subsequently at all state levels. Undoubtedly, it is work-in-process, with the states currently placed across the spectrum of RERA implementation. On the one hand, Maharashtra and Madhya Pradesh have taken the lead and are markedly ahead, while Haryana and Bengal on the other, have still to catch up.

In the very brief history of RERA, it is worth taking a quick glimpse of what RERA has achieved by itself, and what its collateral impact has been.

A quick look at the rulings given by Maha RERA, arguably the most advanced state in implementing RERA, at the end of 2018, tells us that nearly 5,000 complaints were received and over 3,100 orders passed. Just till the end-2017, 79% rulings were in the favour of buyers. That should give us an estimate of the speed and the extent of buyer-protection that RERA offers. It is evident that as various states establish the authorities; and as these state authorities come to function at optimal efficiencies, real estate will be a radically transformed industry.

At the same time, it is imperative to check RERA’s collateral impact. We asses how prices – the best indication of the state of markets –behaved through implementation of RERA.

It is evident that while the prices had been in a steady decline between 2013 and 2016, the cycle turned negative in the period immediately following the implementation of RERA. Evidently, the sales dipped, and projects began to struggle to cope with the rigorous requirements of the now regulated industry. It is well-known that residential real estate creation was historically dependent on customer advances. As customers booked homes, the initial capital flowed in. Stage-wise payments from customers ensured that the construction process remained a customer-funded activity.

Often, in the absence of a transparent mechanism and due to lack of disclosure mechanisms, the payments thus received were deployed in other projects as well. One of the fundamental changes brought about by RERA was a halt to this practice of diversion of funds to other projects or land purchases. 75% of the funding received for a certain project, was to be deposited in escrow and full disclosures were required. This did create a grind for the developers, who could no more use customer advances for any activity other than what it was meant for.

It should be remembered that this period of negative growth in prices coincides with, and is closely linked to, some other remarkable events, namely, demonetisation, temporary ban on construction in Mumbai, implementation of GST, and a little later, the liquidity crisis of 2018. All of these, along with RERA, contributed to the slowdown in the industry, leading to falling sales every successive half-year as well as negative price growth. GST implementation, the other structural change apart from RERA, can be said to have contributed significantly to the ways of doing business in residential real estate.

The downward movement in prices has been increasingly arrested in 2018 and continues along the upward path. It can be understood that while the flurry of reforms and various policy measures sent successive shock-waves in the real estate industry, the eventual acceptance of the new reality is sinking in. The supply side has clearly begun learning the dynamics of this ‘changed’ environment, and has been redrawing its business models.

In the years pre-dating RERA, customer grievances were addressed in the courts, for which buyers were usually neither capable nor had the sustenance for long-drawn cases. RERA has definitely eased life for them. But, this is just one part of the benefit. People do not buy houses to fight cases. Homes are for living and usually bought once in a lifetime, with the savings of a lifetime. Such a purchase needs greater scrutiny as well as protection.

The greatest protection for demand side comes in the form of much higher transparency and an assurance on proper deployment of funds by builders. Similarly, alterations to promised layouts or designs are not possible anymore, at least under normal circumstances. RERA seeks to establish information symmetry, and as it is implemented across the country, we should have a market which is open to scrutiny and is transparent.

It has been vigorously argued on numerous platforms whether these changes, of which RERA happened to be the first link in the chain, have been worth the pain. However, it is evident that RERA is the need of the hour and is here to stay. The two years since it was born, have been turbulent, arguably making it look bigger than it is. There is little doubt, nonetheless, that it has altered an industry that was often opaque at best, or, notoriously oblivious to customer interests at worst.

Source: www.thepropertytimes.in/rera-act-completing-2-years-influence-real-estate-industry

The government notified the final rules to implement the Real Estate (Regulation and Development) Act, 2016 (RERA) that aims to bring transparency and set accountability in the sector and help in completion of stalled projects. The rules will be applicable for five Union territories without legislature of Andaman & Nicobar Islands, Dadra & Nagar Haveli, Daman & Diu, Lakshadweep and Chandigarh.

Here are the key points you should know about:

1. Pay Compensation: Developers will now be required to refund or pay compensation to the allottees for delay in projects with an interest rate of the State Bank of India’s highest marginal cost of lending rate plus 2% within 45 days of it becoming due. This would come to around 11% to 12%.
2. Deposit Money: For the completion of ongoing projects, developers will have to deposit 70% of the amount collected and unused within three months of applying for registration of a project with the Real Estate Regulatory Authority in a separate bank account.
3. Punishment: The rules also contain clauses providing for compounding of punishment with imprisonment for violation of the orders of Real Estate Appellate Tribunal against payment of 10% of project cost in case of developers and 10% of the cost of property purchased in case of allottees and agents.
4. Sale of Properties: Discrimination in sale of properties on any grounds will also not be entertained under the new rules. Adjudicating Officers, Real Estate Authorities and Appellate Tribunals shall dispose of complaints within 60 days.
5. Certification: In respect of the ongoing projects that have not received completion certificate in specified time, developers will have to make public the original sanctioned plans with specifications and changes made later, total amount collected from allottees, money used, original timeline for completion and the time period within which the developer undertakes to complete the project.
6. Carpet Area: Promoter shall also declare size of the apartment based on carpet area even if it was earlier sold on any other basis.
7. Registration: For registration of projects with the authorities, developers will be required to submit authenticated copy of PAN card, annual report comprising audited profit and loss account, balance sheet, cash flow statement and auditors report of the promoter for the immediate three preceding years, authenticated copy of legal title deed, copy of collaboration agreement if the promoter is not the owner of the plot. Promoter also has to declare information regarding the number of open and closed parking areas in the project.
8. Income Tax Returns: The requirement of disclosing Income Tax returns proposed earlier has been withdrawn in the final Rules keeping in view the confidentiality attached with them and as pointed out by legal experts and promoters.
9. Fee for Registration: To incentivize registration of projects and Real Estate Agents with Regulatory Authorities, fee for the same has been reduced by half based on suggestions from promoters for reduction of fee.
10. Information about Details: To enable informed decisions by buyers, Real Estate Regulatory Authorities will ensure publication on their websites information relating to profile and track record of promoters, details of litigations, advertisement and prospectus issued about the project, details of apartments, plots and garages, registered agents and consultants, development plan, financial details of the promoters, status of approvals and projects etc.

Sources – www.realty.economictimes.indiatimes.com/slide-shows/rera-rules-10-things-to-know-about/55156347

RERA Updates

• A Brand New concept was launched for the First Time in India couple of years back by 5 – 6 mavericks simultaneously having started, home inspection services.
• Leading professionals (from IIT / IIM / Google / SAP / Wharton / ICAI) launch the home inspection services across major Indian cities including Kolkata, Mumbai, Bangalore, Gurgaon, Delhi, Pune, Chennai, Navi Mumbai, Goa, Kohima, etc.
• These companies include MACJ – A Buyers Choice Home Inspections, HomeInspeKtor, E-ghar, Checkmyprop, Nemmadi, meazurement, etc.
• All these companies have now come together and formed the “Home Inspection Association of India”, a milestone achieved in the country.
• The Association has been formed with the objective to have a common platform for the growth, development & regulation of Home Inspection Industry in India with the objective of ensuring Healthy and Safe Homes.
• This development has major significance in the background of RERA (Real Estate Regulation & Development Act) being enacted to promote Transparency & Efficiency in the sale of Real Estate projects and to protect the interest of Home Buyers in the Real Estate Sector.

Visit: www.macj-abuyerschoice.com/welcome-to-the-sunshine-industry-professional-home-inspection-services/

Home Inspection Industry, has its seed sown in India from the City of Joy (Kolkata).

Home Inspection Industry, a potential contributor to the Indian Economy within a due course of time, and a multi-Billion US Dollars Concept. It has its seed sown from Kolkata (City of Joy), and spreading all over India at a Rapid Speed. With over 12 to 15 Companies already started operating in different parts of India within a span of two years, the service is making its presence felt, with this well proven Concept World Wide. Companies like MACJ- A Buyer’s Choice Home Inspections (PAN – India), HomeInspeKtor (Bangalore), E-Ghar (Delhi), Meazurement (Mumbai), Nemmadi (Bangalore), Checkmyprop (Pune) etc, have taken an Initiative to nurture and Promote this Industry in the Country. And accordingly have formed “Home Inspection Association of India” (HIA) a Non-profitable venture.

The Objectives of the Association are:

• To Spread Awareness about the availability of the Service across the Country.
• To streamline and incorporate an Operating Standard for all the Home Inspection Companies and related Professionals.
• To Encourage and Promote the Industry throughout India. And spread awareness about the business opportunity.
• To train young mind and encourage them to opt for a new and reliable profession called Home Inspectors. Further creating Huge Employment Opportunity in various Sector.

The Latest updates relating to this Industry are as follows:

• Home Inspection a Brand new Concept launched in India for the First Time. 12-15 Companies started Operating in different parts of India.
• Home Inspection Association of India formed on January 2018.
• Top Home Inspectors of India joining as Founding Members of the Association.
• Mr. Gautam Chatterjee (MahaRERA Chairman) agreed to be an Honorary Member of the Association.
• Website of the Association launched. (www.hiai.in)
• MACJ – A Buyer’s Choice Home Inspections conducted more than few thousand Inspection of Indian Homes across the Country.