Real Estate Bill: Realty Honchos React!

In a landmark move, the Union Cabinet gave a green signal to the Real Estate Regulatory Bill on 9th December, 2015. The realty sector and public has largely welcomed this move, predicting a better demand for real estate in the times to come.

CommonFloor.com spoke to several realty experts on the same. Here is what they have to say.

Welcoming the move, Manoj Gaur, President, CREDAI NCR said, “Real estate bill is expected to protect the interest of both buyers as well as developers. There are many positives in the bill that will help in setting up a better environment for real estate sector. At the same time, the bill has made it amply clear that regulatory authorities have to promote Single Window Clearances for Real estate projects and thus it can be said that it is now up to the States to set up single window clearance mechanism.”

The bill is aimed at protecting the interest of home buyers and encouraging investments in the sector while ensuring accountability and transparency. Adding to Gaur’s comments, Deepak Kapoor, President, CREDAI Western UP said, “The Real Estate Bill will provide a uniform regulatory environment to ensure speedy settlement of disputes and orderly growth of the real estate sector. However CREDAI Western U.P. is also incorporating some more amendments for better applicability of the Bill.”

2015 has been a year of some positive developments towards bringing order and stability in the sector. Commenting on the development, Vineet Relia, Managing Director, SARE Homes said, “The sector is currently going through a wait-and-watch phase. This was a long awaited measure that appears to benefit both the developers and consumers because of the regulatory uniformity element. This move is a good push to bring back the consumer confidence segment and encourage transparency, however, few issues need to be addressed in order to ensure an upward growth trend in the sector. As a developer, we are hoping that the amendment would promote speedy approvals and execution of projects, bring about professionalism and accountability in real estate transactions and give a push to the investment sentiment in the sector.”

The bill will no doubt bring huge relief to the realty sector and all the concerned stakeholders. Sanjay Rastogi, Director, Saviour Builders Pvt. Ltd. opines, developers would be required to deposit specified amount in a separate bank account or escrow account to cover the construction cost of the project. This in turn would ensure timely completion of the project. Also, developers would not be allowed to make any changes in design of the units without the consent of the customers. All these measures would allow only genuine builders to operate in the market.”

Moreover, “The bill will help increased domestic and foreign investment in real estate sector which will be in line with the government’s objective to provide ‘Housing to all by 2022’, adds Om Chaudhry, Founder & CEO of FIRE Capital and Chairman & CEO of Astrum Value Homes.

Investments in the sector would drive growth to a sector which is straddled with huge developer debts and high cost of capital. The single-window clearance is the major feature that will help in cutting down approvals, which runs into 20-30s, and finally may see developers delivering projects on time. Grading of developers would also help in instilling healthy competition and would give customer a transparent mechanism to evaluate an investment,” explains Ankur Jindal, COO- Sales of SVP Group.

While the industry stalwarts welcomes the move, they also feel that “the Regulatory Bill by the cabinet should also engage Approving authorities so that the real estate project don’t get delay on getting approvals and timely deliveries can be given to the customers,’’ as per R.K Arora, Chairman, Supertech Limited.

Adding to it, Anil Sharma, CMD, Amrapali Group says, “at initial level it seems good although it could have been more effective if all stake holders like, approving authorities, financial institutions, structural and architectural consultants, contractors in the ambit of this bill as this would help in regulating the approval process and appropriate delivery time of any project.”

Few experts also feel that the bill has not covered few major issues such as sanctioning authority has not been made part of this bill, which leads to delays in many projects. “We are disappointed with the clause which mentions the inclusion of old & ongoing commercial & residential projects. This is the time when the sector needs a push from the government with friendly policies but unfortunately the particular clause dampens the spirit of the developers,” adds Gaur.