FICCI Grant on new real estate law, the Real Estate Regulation Act 2016 or RERA, will advocate transparency in real estate transactions, reducing the number of litigations in the sector.
The new Real estate bill, RERA, has been passed by Rajya Sabha. The RERA bill, 2016 seeks to protect the interests of aspiring house buyers. The law further looks at enhancing the credibility of the construction industry by promoting transparency, accountability, and efficiency in the execution of projects.
Respondents of the survey of RERA 2016 felt that the new act will improve the hold of governance in the sector which will push more foreign domestic investments into the industry in the short term.
At a glance: Important inputs from the Bill:
- There will be an improvement in the ease of availability of financing options in the market.
- With the rule of depositing 70% of sales proceeds, there will help in the timely delivery of the project.
- Eliminate fly-by-night operators in the real estate.
- Bring in stabilization in prices.
- Immunizes buyers from any fraudulent practices.
Over 65 percent of the respondents in the report feel transparency will increase in real estate dealings going forward. Around 60 percent think RERA will increase governance hold on the sector, lead to increased investments. Approximately 50 percent of the respondents hope lending options from lenders will improve and availing finance will be more accessible.
The report recommends that complying with this act should not become another layer of approval and somewhat eases the entire approval process for builders.
From the developer side, if they comply with the provisions of RERA after they get used to its regulations and the complexity of its rules, it could push prices upwards in the short-term.