By Ranjana Konatt | Editor
What are the developments we see after the adoption of RERA, how has the construction and real-estate sector fared in India? Have certain states performed better than others and how is it coming to terms with new laws?
RERA has perhaps been the most important regulation to instil transparency, accountability and financial discipline in the real estate sector. The prime objective of this landmark legislation was to bring in much-needed transparency into the sector and to address homebuyers’ grievances. However, as states were given powers to notify their respective rules, initially many states tweaked the provisions and delayed the enactment. This delay in notifying the rules resulted in developers opting for wait-and-watch mode, which in turn affected new launches.
With over two and half years in existence, the market is now finally coming to terms with the new law. As on September 2019, 30 States/UTs have notified rules under RERA, while 29 States/UTs have set up Real Estate Regulatory Authority. Further, 24 States/UTs have operational websites. North-eastern states of Arunachal Pradesh, Meghalaya, Nagaland, and Sikkim – which earlier shied away from it – will soon officially notify their RERA rules. s
Few states have fared better than the rest. For instance, as on early October 2019 Maharashtra, Gujarat, Karnataka, Madhya Pradesh and Uttar Pradesh alone accounted for 81% share of total project registrations across the country with nearly 36,576 projects registered. With approximately 22,455 project registrations, Maharashtra is the clear leader. The state’s regulatory body, MahaRERA has been diligently working towards bridging the gap between developers and home buyers. It has taken firm steps against errant developers and these measures have brought back buyer confidence into the market to a large extent.
Agent Registration: Another yardstick to measure the implementation of RERA is agent registrations that have also been on the rise during this one year. Data trends suggest a 54% increment in agent registrations across states and UTs in the country under RERA. While Maharashtra, Karnataka and Uttar Pradesh have fared well on this count, Haryana and Punjab have also witnessed a jump in agent registrations under RERA.
Cases resolved: Authorities across states/UTs have successfully resolved real estate disputes and resolved 27,970 cases as on early October this year. With 11,596 solved cases, Uttar Pradesh had the distinction of highest disposal rate, followed by Maharashtra with 5,817 cases, Haryana with 2,480 cases and Madhya Pradesh with 2,465 cases.
What are the trends that we see in Assam, Chandigarh, Daman & Diu and Puducherry see projects registrations for the first time in a year?
Till a year ago, Assam, Chandigarh, Daman & Diu and Puducherry saw no project registrations under RERA. However, this year these states have cumulatively seen property registrations of nearly 154 projects. In terms of agent registration, these states and UTs together account for 29 registrations.
What are the trends that we see in the market, do you see people investing in real estate?
Over the last few years, homebuyers have faced several hurdles and challenges during their home-buying journey. Facing the double whammy of paying rent as well as EMI, homebuyers have had to deal with errant developers failing to meet delivery and possession deadlines. Presently, the Indian real estate market has approximately 5.65 lakh incomplete units that were launched in 2013 or before. Cash-strapped developers facing a severe liquidity crunch have been unable to deliver projects leaving lakhs of home buyers high and dry.
Developers across the country facing proceedings at the NCLT, along with the ban on subvention schemes has also dampened the buyers’ interest. Moreover, the high prices of properties in major cities like Mumbai and Delhi have also prevented home buyers from foraying into the property market. Despite these challenges, several home buyers continue to believe in India’s real estate story. RERA has empowered home buyers and given them a platform to take errant developers to the task. For the first time in years, homebuyers now have a forum to resolve their issues and get relief.
Meanwhile, other judicial forums such as the Supreme Court have emboldened homebuyers with landmark judgements such as the cancellation of Amrapali Group’s RERA license. NCDRC’s recent announcement allowing buyers to seek a refund in case of indefinite delay has also come as a shot in the arm for homebuyers. The festive season has come with developers offering several deals including hard discounts, GST or stamp duty and registration charge waiver and freebies including cars, bikes and electronic goods. With measures like the government’s stimulus package to bail out real estate companies, more home buyers are feeling confident about the real estate market and are expected to buy sooner rather than later.