After RERA gets implemented there will be a liquidity issues for builders

Q: During the initial change after the real estate regulatory bill comes to force, there will a liquidity issues for the real estate developers, particularly for the small players.

Kalki K,

15th March 2016

Real estate News in Delhi

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Replies (5)

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nishant, Kolkata

8th November 2017

Comment

How rera exactly helps us to get affordable houses

amit debo,

31st May 2017

Comment

Although this bill requires the Regulatory Authority to make recommendations for setting up of a single window clearance system but no strong provision has been included for speed up the approval process.

Awar Ali,

15th March 2016

Comment

That is not the only issue that a developer has to face, once the passing of the bill in the upper house, restriction on sales without registration of a project and restriction on acceptance of deposits without registering the agreement for sale may also create funding troubles for the builders.

jitu jayswal,

15th March 2016

Comment

Hi Jitu,
I think in current real estate market, having a standard rate of 70% for all projects may prove to be difficult for developers in projects with high land cost factor.

david.m,

15th March 2016

It's true but on the other hand, real estate sector will be transparent for the buyers. The bill also requires builders to register their projects with regulatory authorities disclosing details of promoter, schedule of implementation, layout plan, land status, status of approvals, agreements along with details of real estate agents, contractors, architects, structural engineers, etc.

jitu jayswal,

15th March 2016

The real estate bill will also made registration mandatory where land proposed to be developed increases 500 sq-mt or number of apartments proposed to be developed increases 8.

As per ICRA, there needs to be increased co-ordination among multiple authorities for quick regulatory approvals. Now, the real estate bill only has provision for penalising developers in case of delays beyond indicated timelines, but no magnitude is made in projects that face delays because of delays in getting approvals.

david.m,

15th March 2016

Yes, the Real estate bills mandates developers to deposit 70% of the collections from the buyers for the pre-launch booking in a separate account to meet construction costs including land.

shaina,

15th March 2016

Comment