'Realty regulator bill leads to licence raj'

'Realty regulator bill leads to licence raj'

'Realty regulator bill leads to licence raj'

The Real Estate (Regulation and Development), Bill 2013, approved by the Union Cabinet on Tuesday has evoked a sharp response by industry body (CREDAI) and a call for appropriate amendment/deletion of some provisions, which are likely to result in “substantial increase” in costs to home buyers.

In a statement issued on Wednesday, Confederation of Real Estate Developers’ Associations of India (CREDAI)'s National President C Shekar Reddy said, “Certain provisions in the bill are required to be amended / removed otherwise it will result in substantial increase in the cost to the home buyers and in long run will shatter Governments dream to have 'housing for all.'”

He added that CREDAI has “strong reservations” on some of the provisions and will work with the housing ministry and states so that its members are not “unnecessarily victimised” and licence raj does not come back.

Referring to the provision on revocation of registration, it will put projects in limbo for months and years due to litigation and go against consumer interests.

Real estate services firm Jones Lang LaSalle India Chairman & Country Head Anuj Puri welcomed the bill and said, “It will look to provide considerable relief to the ordinary buyer and investor who goes through innumerable obstacles when buying a property and at times is duped by even small developers, builders and brokers.”

Contrary to CREDAI's response, he saw many positives in the regulation, including the proposed appellate tribunal to resolve disputes and thereby cut short prolonged litigation in consumer courts, ensure timely completion of projects, preventing developers from putting out misleading advertisements and transparency with regard to sanctions and approvals.

Highlighting another upside, he said, “While it aims to hold the developers accountable, it also looks to ensure that the allottees do not default in making payments. Thus, by providing penalties for both the promoters and the allottees, the Bill seeks to ensure that non-compliance is minimal.”

Another real consultancy, Cushman & Wakefield has said that the bill would give a fillip to investments in the housing sector. The firm's Managing Director, South Asia, Sanjay Dutt said, “We also see this working positively in terms of attracting investments from domestic and international funds that have harboured skepticism towards investing in Indian Real estate largely on account of lack of regulation.”