by on May 27, 2018
When the Parliament passed Real Estate Regulation and Development Act (RERA) in 2016 with a directive to all 29 states and 7 Union Territories to set up a regulatory authority by May 2017, it had brought a welcome cheer among the home buyers. They hoped for a hassle-free and low-risk home buying experience.
While the aim of RERA was to protect interests of real estate customers, enhance their trust and promote transparent transactions, it appears that nothing much has been achieved. As RERA completes one year of the enforcement, the progress is dismissal.
According to the white paper released by the real estate consultancy firm Knight Frank India on the first anniversary of RERA:
• Only 20 states have been notified of RERA rules.
• Only 19 states and Union Territories have a functional RERA website in place. However, these portals are not of much use to the home buyers as there is a considerable amount of dissymmetry in the information across data points.
• Only 15 states and Union Territories have established Real Estate Appellate Tribunal.
• Barring Maharashtra, Punjab and Madhya Pradesh, no other state and Union Territory have established a permanent RERA authority. The rest have taken a quasi-implementation route.
• More than 25,000 projects have been registered under RERA across India. However, 62% of projects are registered from Maharashtra alone.
These findings indicate that the trouble is still brewing in the real estate. The home buyers are still facing issues such as delayed delivery and sub-standard quality of construction in the states where RERA implementation is still pending or in the interim phase.
On the positive side, RERA is creating a significant impact in some states. For instance, Maharashtra RERA authority has issued notices to builders who have not updated information on their project details and even levied penalties on those who have not adhered to advertisement norms. Similarly, Haryana RERA imposed a fine of Rs30 lakhs on a private developer for inviting applications for a project without registering it. The developers who have registered their projects have led buyers to have full clarity regarding property size, layout, amenities and other relevant factors, thereby instilling their confidence in the real estate market.
Final Verdict
We believe that RERA has immense potential to regulate the real estate industry. However, its sluggish implementation has rendered its effectiveness futile. Both central and state governments, as well as the property developers, need to play an active role to implement RERA in full spirit. The purpose with which RERA was introduced is very much achievable. However, there is still a lot to be desired and done.
Post in: Real Estate
Topics: rera, real estate