Single-window clearance is need of hour, say builders
At the first look, the Real estate bill that got the thumbs up of the Rajya Sabha on Thursday is pro-consumer bill, say real-estate experts in the city. The central government’s decision to set up a proper regulatory body for this currently unorganised market will ease flow of FDI in this sector.
Om Ahuja, CEO Residential Brigade, said, “The Bill is a blessing in disguise for both buyer and reputed builders. The Bill will help curb the number of fly-by-night developers and bring in more transparency in the system, which will assist the buyer and help them from getting duped and encourage foreign investors to come in.”
The Bill requires project promoters to register their projects with the Regulatory Authorities disclosing all miniscule project information. The developer will also need consent of two-third of all the buyers for a particular project before making any change in the layout proposed.
Satish BN, executive director Knight and Frank South-India, said, “The Bill will help invite new buyers and customers in the real estate sector as the current regulation that are being introduced will unveil all the malpractices that were earlier there in this sector and in turn will help to revive this ailing sector.”
However, both builders and real estate players believe that the issue of single-window clearance has not been addressed. Currently the most tedious task for a developer is to get the project clearance from the government, which at times even results in delay of executing the project.
“This aspect of speedy clearance mechanism is needed for ease of doing business for most of the developers, so that the real estate sector can see a robust growth. Similarly the government also needs to earmark the people coming under tax exemption for being first time buyer, under the affordable housing scheme, to have proper transparency and benefit those who need it,” said Satish .
EXPERTS ON THE BILL
Asingle-window clearance is needed now, without which there may be cases where bona-fide delays by developers may still result in an unfavourable penalty. The time taken to get many environmental, state-level and municipal-level clearances have afflicted developers for long. Without ensuring that the approval process is not delayed by civic agencies’ inaction or setting up a single-window system, the regulator may inadvertently add another layer to the longer processes already delaying projects ANUJ PURI, Chairman and Country Head JLL India
For organised and large developers, this would help reduce competition from part-time developers who do not comprehend the real estate development in depth. Most developers would now need to upgrade their project development skills especially in the area of project planning, project management, risk management, engineering and design etc. to deliver quality on time NEERAJ BANSAL, Partner & Head of Real Estate and Construction sector, KPMG in India
THE BUILDERS’ SIDE STORY
The Confederation of Real Estate Developers Association of IndiaKarnataka welcomes the passage of the real estate, regulation and development, bill as it would enhance the credibility, transparency and trustworthiness of real estate benefitting all stakeholders, particularly the consumers
DR VK JAGADISH BABU, President CREDAI Karnataka
The real estate regulatory bill has been long in the pipeline, and has now cleared all roadblocks and become a law. It is all set to revolutionize the Indian realty market. It will empower consumers by giving them confidence while deciding their real estate investments. It imposes strict regulations on how developers conduct their business, and underwent various redrafts aimed at doing this. It is very encouraging that the bill is now a reality ARVIND JAIN, Managing Director - Pride Group
BILL: IN THE OFFING
1 The Bill ensures the timely completion and delivery of flats to the consumer. It ensures that strict regulations will be imposed on developers to ensure timely construction and delivery. It further provides that consumers are entitled to a full refund with interest, if there has been a long delay in the delivery of a flat.
2 Bill has put in place a robust mechanism for the publication of accurate project details and disclosures. No one can deny that in the past, there have been myriad instances in which developers have misled consumers.
3 Bill provides that developers must mandatorily mention the actual carpet area of projects to the consumers. Thus far, developers have typically sold properties by citing super built area. By mandating that the carpet area be explicitly mentioned through section 4, this Bill is ensuring that even the most undiscerning consumers are thoroughly informed.
4 Bill ensures that all clearances are completed before the launch of a project. Sections of the Bill mandate that developers have to receive all clearances before issuing their properties for sale.
5 Bill mandates that developers are bound to provide after sales service for properties found to have structural defects, at no extra cost to the consumer. Under the Bill, buyers are simply required to inform the developers of the deficiency within one year of purchase.
