The key objectives of Real Estate (Regulation and Development) Act — transparency, financial discipline, and accountability — are the new norms visible across the market. Homebuyers are now much better off than earlier.
There is good news for homebuyers, who have invested their money in the real estate sector and big news for all prospective homebuyers, who plan to enter the market.
JLL, a property consultancy firm, says in its latest analysis that the real estate market is showing signs of an evolving and mature market, as it is getting organised and accountable.
Quoting data with the ministry of housing and urban affairs, the report said 43,398 real estate projects and 33,270 real estate agents have registered under RERA across the country till June 30, 2019. While 90% of the states and Union territories have so far notified the rules, 69% of those have operational web portals, the report said.
The JLL analysis says that the actual impact of RERA, however, would be even more discernible over the next few years, as projects will meet delivery timelines that they committed in their RERA registrations and cases of effective dispute resolution between the buyers and promoters will increase.
How are homebuyers benefiting?
Ensures delivery: Accountability would mean that delivery will not be a challenge.
“The implementation has been quite smooth and most developers of repute are building projects conforming to strict RERA guidelines … they must submit quarterly reviews about sales and construction. This, in turn, ensures the oversight of RERA throughout the construction period. Builders are now aware that only those who have the capability to complete projects will remain, as RERA has provision for imprisonment as well,” Manoj Gaur, MD of Gaurs Group and Chairman of the Affordable Housing Committee of Credai, said.
“With the implementation of RERA, the scenario is changing: developers are concentrating on timely delivery. This has boosted trust among buyers,” Rahul Singla, Director of Mapsko Group, said.
Full disclosures & transparency: The RERA mandates development firms to completely disclose all the details of their projects.
“A customer can now get the exact details of his investment. This has not just brought in more transparency, it has also helped buyers make the right decision,” Manoj Gaur said.
In turn, the compliances will bolster the chances of further investments by banks and institutional fund houses.
What it means for the market?
This transformation must be seen in a national perspective. Market updates reveal that new launches are subdued and developers are focusing on delivery of existing projects. Government policies now dictate the market.
“Demonetization, RERA, and GST put a tight leash on unregulated practices — and their practitioners — in the Indian real estate. Most large players are looking to significantly increase their overall supply in these segments and have sharply reduced their supply in the luxury and ultraluxury segments,” Prashant Thakur, Director and head of research at ANAROCK Property Consultants, says in his recent analysis.