How Real Estate Bill impact builders and buyers..

Q: Hi everybody!
I want to know the impact of Real Estate Bill on both Builders and Developers

Vinay Dixit, Mumbai

10th December 2015

Real estate News in Mumbai

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impact of real estate bill 2015

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real estate (regulation and development) bill

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Replies (4)

What real estate analysts' view on Real Estate (Regulation and Development) bill?

Nakul, Faridabad

10th December 2015

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Wel Nakul,
As per them, this bill will ring in much-needed transparency in the real estate sector. This will help fund flow in the projects. It will go in favor of both consumers as well as developers who do clean business. Transparency in real estate attracts FDI.

Shrabani Deodhar, Pune

10th December 2015

Are builders happy with the cabinet's approval?

Nakul, Faridabad

10th December 2015

Yes, The industry has welcomed the approval of real estate regulatory bill by the Cabinet. However, the companies demanded that the government authorities sanctioning the projects should also be part of the proposed law. But some issues need to be sorted otherwise it will lead to more delays.

Kasturi, Noida

10th December 2015

It seems to me that Consumer protection is the base of the bill? What do you think?

Raajan, Hyderabad

10th December 2015

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@Raajan,
It is true. the government has brought about 20 changes in the bill, of which the key is inclusion of insurance for land, which will protect buyers and developers from frauds. In the latest version, builders are required to deposit 70% of the project cost into an escrow account. The NDA had brought this amount to 50% in favour of builders. The government has become soft to the Opposition demands on this and gone back to the 70% provision. The bill also demands to punish both builders and buyers for for violations of the proposed law.

Kasturi, Noida

10th December 2015

Hello Kasturi,
But i heard that builders are likely to be imprisoned for up to 3 yrs. in case of violation and real estate agents and buyers up to 1 year in case.

Nakul, Faridabad

10th December 2015

@Nakul,
Picture is not clear yet and it will only clear once it get approval. But the permission to approach consumer courts should come in as a major relief for the buyers. There are 644 consumer courts in the country.

Another major change approved by the Cabinet is the proposal to charge equal rate of interest for promoters and buyers in case of default or delays. The provision was earlier tilted in favour of the builders.

Shrabani Deodhar, Pune

10th December 2015

We all hoping for the best Vinay. What are the salient features of this bill? According to the government press release, the Real Estate (Regulation and Development) Bill is a initiative to protect the interest of consumers, encourage fair play in real estate transactions and to ensure timely implementation of projects.

Raajan, Hyderabad

10th December 2015

Comment

Good Morning Raajan!,
The key features of the bill are:- 1) It makes compulsory disclosure of all details registered projects, including those about the promoter, project, layout plan, land status, approvals, agreements along with details of real estate agents, contractors, architect, structural engineer etc.
2) Developers have to deposit specified amount in a separate bank account to cover the construction cost of the project for timely completion of the project.
3) It makes registration of real estate projects and real estate agents with the authority.
4) Promoters are interrupted from changing plans and design without consent of consumers.
5) It seeks to set up Real Estate Regulatory Authority in states and union territories to oversee real estate transactions.
6) It asks to establish fast track dispute resolution mechanisms for settlement of disputes through adjudicating officers and Appellate Tribunal.
7) It regulates both commercial and residential real estate projects

Shrabani Deodhar, Pune

10th December 2015

Hi Vinay,
The NDA government had earlier added a few provisions in the bill, to which the Congress objected. The original bill was brought in by the UPA. With the NDA incorporating the committee's recommendations, there are chances that this time the Bill will now be taken up for consideration and passed by Parliament.

Nakul, Faridabad

10th December 2015

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