Real estate bill gets cabinet nod: what are the experts saying
The cabinet on Tuesday approved the much awaited Real Estate (Regulation and Development) Bill that proposes to make India‚Äôs largely unregulated and once booming real estate sector more transparent.
Ajay Maken, minister of housing & urban poverty alleviation, in a government statement said the bill provides for a uniform regulatory environment to protect consumer interests and ensure orderly growth of the real estate sector.
He expressed hope that the proposed legislation would significantly reduce frauds and delays. (Read the complete statement with highlights of the bill here)
High interest rates, rising prices and a slowing economy have hurt demand for housing in recent years, as companies continue to battle high debt and increasing construction costs.
Here are some views from experts on the proposed bill:
Anshuman Magazine, CBRE South Asia: The real estate regulator bill should have been more balanced taking view of challenges faced by developers and consumer grievances. While consumers need protection, for real estate development to happen more efficiently, and in a transparent manner, administrative reforms are required urgently.
Anuj Puri, Jones Lang LaSalle India: The bill works both ways. While it aims to hold the developers accountable, it also looks to ensure that the allottees do not default in making payments. Thus, by providing penalties for both the promoters and the allottees, the bill seeks to ensure that non-compliance is minimal. On enactment, the bill seeks to ensure that real estate transactions are carried out in a just and equitable manner.
Sriram Khattar, DLF: It is good for the transparency and governance for the sector which is highly fragmented. However it should not add another layer of bureaucracy in an industry which is heavily burdened by multiple approvals from different agencies which increases the project completion cycle and also adds costs to the project.
Sanjay Dutt, Cushman & Wakefield: In the short to medium term, after the bill is enforced, we may see a noticeable slowdown in launches of new projects, as getting all the necessary permissions in place is a long and tedious process.
Brotin Banerjee, Tata Housing: 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.
Firdose Vandrevala, CII National Committee on Real Estate & Housing: Though we must also keep in mind that multiple Acts and Rules exist for protection of consumer interests for any deficient services in any sector and hence it needs to be ensured that the proposed Real Estate Regulatory Authority (RERA) does not end up merely replicating various functional roles.
Naushad Panjwani, Knight Frank India: This is a welcome and a long awaited measure that both the consumer and the realtors were asking for. However while consumers have a lot to gain from this, the realtors will have mixed feelings.. Even though progressive developers and trade chambers have welcomed it the bill appears to be a tad harsh for realtors.