BENGALURU: Spokespersons of CREDAI, the apex body of private real estate developers’ associations, clarified on Wednesday that only projects in which 60 per cent of properties have been registered are exempt from the RERA Act, and not projects which are 60 per cent complete.
Providing a clarification on which projects could be exempted from the Act, CREDAI, Bengaluru president Ashish Puravankara said, “It is to be noted here that sale deeds are executed only after the projects are completed, which is in line with the Act. Likewise, layouts that have handed over charge of civic infrastructure to the local authorities are rightfully exempted as such handing over happens only after the full completion of the project. The same is applicable to exemption of apartments that have handed over the maintenance of the common areas to the residents’ associations as such projects are completed and mostly occupied too.”
The notification also exempts projects that have applied for occupancy certificate (OC) as the same is applied only when the project is completed. In the case of projects that have received partial OC, the exemption is accorded only to that phase which has received the OC. Former CREDAI Bengaluru president Balakrishna Hegde said, “The Act also says that all development works should be completed and certified by the agency concerned.”
The spokespersons opined that contrary to the popular view that the Act favours developers, it worked in the interest of existing as well as future home buyers.
Puravankara said, “We had hoped that certain aspects of the Act would be more practical and it could have covered every aspect of development, but we welcome the Act.” He added that the Act would have been further effective if the notification had lowered the threshold of the plot area that came under the Act to 100 -150 square metres as against the prevailing 500 square metres. “This would have helped check the deviations happening in this segment”, he said.
About the Act’s effect on real estate prices, another past president B M Jayeshankar said while prices were expected to increase, the extent of it would be known only after 3-4 months. Put the share of the organised sector in real estate at an estimated 60-65 per cent, Jeyashankar said, “Because of RERA, it might go up to 80-85 per cent.”
Certain bodies, including the group ‘Fight for RERA,’ had expressed disappointment with the 60 per cent rule, saying it diluted the Act and gave developers an advantage. Fight for RERA also intends to file a case in this regard.