Saturday, 20 December 2014

Finally, a Real Estate Appellate Tribunal!

Bill in Parliament: Tribunal to be headed by a sitting or a retired judge for adjudicating disputes in realty sector.

The real estate regulation bill, which has to be passed in Parliament, aims to regulate the housing market and protect the interests of home-buyers and developers.
Although the bill is not flawless, it is certainly a step in the right direction and all the stakeholders hope that this new legislation will be supplemented with necessary rules and regulations which will clarify any ambiguities or gaps that exist in the bill.

Taking a risk-based approach, the bill has been modeled taking into account appropriate checkpoints in key stages of a property transaction where regulation is most required, given the history of fraudulent practices and unfulfilled promises, a consultant said.

A common complaint is that developers and builders do not deliver what is promised when selling apartments.

While their advertisements show buildings and landscaping to match international quality, in a majority of cases, the ground reality is far different leaving buyers feeling cheated.

The regulatory body envisaged in the draft bill would ensure that the developers are held accountable for what they promise and provide recourse to customers in case these are not fulfilled.

Some of the guidelines in the bill are provisions like restricting launch of projects or advertisements unless all approvals are received, maintaining separate account for customers' monies, sale of projects based on carpet area, etc, which will indeed help bring in transparency.

Other provisions like mandatory registration of projects within 15 days and registration of brokers are well intentioned but unless objective guidelines and rules are stipulated regarding the registration criteria, there is a danger of subjectivity creeping into the registration process.

Stipulation of `carpet area' as the only measurement unit will limit fraudulent practices from using units like salable area, super built-up area, etc.

The bill proposes to set a real estate appellate tribunal, headed by a sitting or a retired judge, for adjudicating disputes.

J P Gupta, vice-president of Credai NCR-Haryana, says, “In 2015, we expect the government will accord real estate sector the `infrastructure' status and bring in a single-window system for approvals.“ Aman Agarwal, director of KV Developers, says, “We look forward to a better future in 2015 for the real estate market with the government focusing upon the regulatory and land acquisition (amendment) bill."

Dhiraj Jain, director of Mahagun Group, hoped the government would bring more transparency through the land acquisition bill and that the RBI would reduce interest rate to salvage the fund crunch in the sector.

Source: Times Property, Dec 20, 2014

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