The long pending Real Estate Regulatory Bill that got Cabinet nod on Tuesday has brought cheer to the home buyers but the real estate developers feel that the Bill is heavily loaded against the builders. The Bill provides for setting up a regulator for the realty sector and has provisions like a jail term of up to three years for developers who put up misleading advertisements about projects repeatedly. Some builders who claim they work like any other corporate find the provision for jail term ‘offensive’ and say cause of few unscrupulous developers, the setor is being seen in a bad light.
Developers point out that the bill is a lopsided one as it gives more power to home buyers but does not ensure that developers get speedy approvals. “The proposed setup of a regulator will not only protect consumer interests but will also ensure fair practices and accountability on the part of industry players. However, the Bill should be more balanced and should include clauses that protect developers as well. Government should ensure setting up of a Single Window Clearance mechanism to avoid unnecessary delays,” says Brotin Banerjee, MD & CEO, Tata Housing.
The Confederation of Real Estate Developers’ Associations of India (CREDAI) is also of the view that the Bill needs a few amendments to make it a balanced one. “From an industry perspective it’s important the Bill maintains equilibrium between developer community and end users. Certain provisions in the bill are required to be amended or removed otherwise it will result in substantial increase in cost and in long run will shatter government’s dream to have housing for all,” says C Shekar Reddy, national president of CREDAI. Reddy categorically mentioned the provisions such as revocation of registration would certainly put projects in limbo for months and years due to litigation, which will act against the intent of the consumer.
However, developers and consultants agree that seeks the proposed bill will provide a uniform regulatory environment to the sector and make it more transparent which is important as the sector is grappling with a slump. “It would bring buyers at ease along with transparency and respect to the sector,” says Navin Raheja, president, NAREDCO. Delhi-based real estate company Supertech’s chairman and MD, RK Arora adds that the mandatory registration process for any new projects is in favour of customers and will bring confidence and transparency in buying or investing in any such project and will also improve on the sector’s credibility.
Property consultant Jones Lang La Salle India’s country head Anuj Puri opines, “The bill will pave the way for providing the much needed transparency by seeking to regulate the hitherto largely unregulated housing sector in India. Even though Banerjee of Tata Housing feels that the notion that the industry (real estate) is not regulated is debatable.”
Sachin Sandhir, MD, South Asia, RICS, a UK-based self-regulatory realty industry body points out, “Stipulation of ‘carpet area’ as the only measurement unit will limit fraudulent practices arising from use of measurement units such as saleable area, super built up area. The provision will no doubt protect customer interest and create more transparency in transactions.”
