Pre-Rera era Supertech towers demolished, but have things changed under the new regime?

If media reports are to be believed, after the Real Estate Regulation Act (RERA) came into being, all the government officials have become careful in sanctioning building plans, builders are now fearful of the law and the judiciary is trusted as more proactive than reactive.

A fellow panelist at a TV debate emphasised that Supertech twin towers violations are pre-Rera realities. The market has changed a lot in the post-Rera world. Really? I wonder where. Are we talking about some other part of the world?

To be sure, Supertech demolition is not the first such landmark judgment that has been shaping the industry narrative. In 2014, the Competition Commission of India had slapped a Rs 630 crore fine on DLF. However, it is not about one or two defaulters but the ecosystem that supports perpetrators and definitely not the victim – the homebuyers. The C-SAT score of Indian real estate (as per Track2Realty survey) slipped from 20 (out of 100) in 2011, to 18.

All the reforms like RERA, GST, Benami Transactions and demonetisation, etc are reforms only on paper. Nothing has changed on the ground for the hapless homebuyers.

Policy interventions have only made the builders smarter in dodging the bullet. For example, one of the builders in Greater Noida West is forcing buyers to sign an advance consent that the builder is free to make any future changes in the FAR and layout. Any resistance by the homebuyers is silenced with the builder’s wrath and the two-third (needed to vet it) succumb before the mighty builder. One aggrieved homebuyer who approached the consumer commission against the unfair contract is running from pillar to post for speedy justice.

Another builder I know threatens the buyers that if they dare approach Rera against any delay or default, he will make life miserable by delaying the possession of dream homes for years with multiple counter litigations. Salaried homebuyers burdened with both rent and the EMIs can’t challenge the builder in lengthy and costly litigation. This has been a question that even the Supreme Court pointed out in its judgment against Supertech Twin Towers.

I met a harassed homebuyer who wanted to sell his under-construction apartment due to a health emergency at home. The builder refused transfer and said that he could buy back only at the same rate at which he had sold the unit four years back. So all the appreciation benefits go to the builder but the interest burden is the liability of the buyer. The exploitation doesn’t end here. Once the apartment was bought back, the buyer with a critical health emergency at home was asked to wait for the refund till the builder sells off the same unit to someone else. You are trapped in the builder’s net!

You buy a toothpaste for Rs 50 and can criticise the brand on social media if you did not like it. But you can’t criticise the builder who sold the house worth at least Rs 50 lakh with your lifetime earnings. If you do, the builder sends a statement “our legal team is looking into your issue; it is a case of defamation”. One builder has it in his Builder Buyer Agreement that anything not liked by the buyers has to be settled through an arbitrator and the buyer ceases to have any right to amplify the issue on social media. Who will be the arbitrator if the project is delayed or falls short of the buyers’ expectations? It will be appointed by the company (builder) only.

So, is the industry narrative that the landmark judgment would help reform the murky world of Indian real estate correct?

I continue to wonder when and where the wave of reforms swept the business of real estate in this part of the world. A homebuyer is trapped in the builder’s net the moment he pays the token amount. Thereon, he has no choice but to succumb to the builder’s wishes.

Source: https://www.moneycontrol.com/news/business/real-estate/pre-rera-era-supertech-towers-demolished-but-have-things-changed-under-the-new-regime-9101321.html

No Action To Recover EMI For Stuck Realty Projects

The surge in realty projects assuring umpteen homebuyer of the dream of having their own homes have failed to become reality. The aftermath of Real Estate Developer’s inability to deliver projects on time, have left many homebuyers with the additional burdens of paying EMI without having anything in hands.

The Delhi High Court recently in Ashish Tiwari v. Union Bank of India dated January 31, 2022, hearing a number of petitions under Articles 226 and 227 of the Constitution of India of Homebuyers against Banks/ Housing Finance Companies (HFC) disbursing the loan amount through subvention schemes to the developers without even examining the fact as to whether the developers are in a position to complete the construction gave interim relief directing that banks/HFC shall not take any coercive action against the homebuyers to recover EMIs for pending projects where the builders were supposed to pay the EMIs till possession.

Ashish Tiwari v. Union Bank of India- Brief Facts

The Petitioners booked flats with the builders and took home loans under the subvention scheme by entering into a Tripartite Agreement with the builders and the banks. The subvention scheme provided for the banks to disburse the sanctioned amount directly to the accounts of the builders, who were then to pay EMIs on the sanctioned loan amount, until possession of the flats is handed over to the homebuyers. However, builders started defaulting in paying the EMIs to the banks as per the Tripartite Agreement, and subsequently the banks initiated action against the homebuyers to recover the EMIs instead.

Contention by Petitioners

The Petitioners raised the contention that the Banks/ HFCs have given funds to the builder in flagrant violation of the directions issued by the RBI and the NHB wherein the banks have been directed to exercise due caution while disbursing of housing loans sanctioned to individuals under subvention scheme. The Petitioners further submitted that the Respondent/ Banks/HFCs cannot claim payment towards the loan amount, which they in this present matter pre-maturely disbursed to the builders. The Petitioners also submitted that the banks, have in fact, acted in collusion with the builders, in releasing the loan amount even without examining whether the builder was in a position to complete the project or not. The Petitioners in their support placed reliance on the orders passed in Hridesh Kumar Pathak v. Bank of Maharashtra2 and Jayanta Kumar Mishra and Another v. Union of India3, wherein the Division Bench, by way of interim orders, restrained the banks from taking any coercive steps against the Petitioners or the homebuyers.

Contention by Respondents/ Banks/HFC

The Respondents submitted that once the Petitioners had knowingly signed a Tripartite Agreement, they cannot now shift the blame solely on the banks for any default on the part of the builders, and evade their liability to re-pay EMIs in respect of the loans issued in the favour of the Petitioners.

Contention On Behalf Of RBI

Further, the learned Senior Counsel, Mr. V. Giri appearing for the RBI, submitted that the banks are required to comply with the directions and guidelines issued by the RBI whereby the banks were directed to ensure that the disbursal of the loan amount shall be strictly linked with the stages of construction, and no upfront disbursement shall be made in case of under-construction projects.

Order

The Hon’ble Justice Rekha Palli noted relevant extracts of the RBI circular dated 01.07.2015, pertaining to the issue of subvention schemes or “innovative housing loan schemes” wherein it was observed that such housing loan products are likely to expose the banks as well as their home loan borrowers to additional risks e.g. in case of dispute between the individual borrowers and builders, default or delayed payment of EMIs by the builder during the agreed period on behalf of the borrower, non-completion of the project on time, etc. The Hon’ble Justice further noted circular dated 09.07.2019 issued by the NHB, wherein it was observed that the housing finance companies (HFC’s) shall desist from offering loan products involving servicing of the loan dues by builders on behalf of the borrowers and the disbursal of housing loans sanctioned to the individuals shall be closely linked to the stages of construction of the housing projects and disbursal shall not be made in case of incomplete or under-construction projects.

The Hon’ble Justice vide this interim order observed that despite the banks having disbursed the loan amounts when the construction was admittedly incomplete, the Petitioners were being asked to pay the amount that was initially required to be paid by the builders.

The Court further observed that the Petitioners who are individual homebuyers are also facing grave financial hardship on account of the devastating impact of the Covid-19 pandemic. Therefore, the Petitioners have made out a prima facie case, balance of convenience also lies with the Petitioner and grave and irreparable loss would be caused to the homebuyers if they are forced to pay the EMIs in this challenging times due to the default of the builders. Thus, the Court vide this order granted an interim stay in favour of the homebuyers against the recovery of EMIs for pending projects where the builders were supposed to pay the EMIs till the possession.

Conclusion

This interim order in favour of the homebuyers, highlights the sorry state of affairs of the construction industry, where without any possession, innocent homebuyers are being forced by the banks/HFC’s to pay EMIs due to the default of the builders. Thus, the approach of the Hon’ble Delhi High Court in interim order restraining the Banks/HFC’s from taking any coercive steps against the homebuyers is a big positive steps, and especially in such cases where the builders in collusions with the banks/ HFC’s have flagrantly violated the guidelines of the Reserve Bank of India and the National Housing Bank.

Source: https://www.mondaq.com/india/real-estate/1191264/no-action-to-recover-emi-for-stuck-realty-projects

In February, the Supreme Court directed the Centre to examine whether the rules framed by various states under the Real Estate (Regulation and Development) Act (RERA) are in conformity with the central legislation and subserve the interest of homebuyers.

States should not dilute RERA provisions: Union housing minister Puri

In February, the Supreme Court directed the Centre to examine whether the rules framed by various states under the Real Estate (Regulation and Development) Act (RERA) are in conformity with the central legislation and subserve the interest of homebuyers.

Union minister for housing and urban affairs Hardeep Singh Puri on Tuesday asserted that there should be no dilution of the provisions of the Real Estate (Regulation and Development) Act, called as RERA, by states, and assured that the Centre will not bring the “whole template down” even if some states decide to dilute the norms.

He said the RERA is a widely accepted legislation and its success is anchored in the spirit of gradual but steady problem-solving.

The minister was speaking at a meeting of the Central Advisory Council (CAC), constituted under the RERA Act, 2016.

During the meeting, measures to ensure structural safety in high-rise buildings and prevent loss of life as well as property, besides considering a proposal to set up a high-level panel to address the issue of stalled projects, was discussed.

Regarding incidents of building collapses, Puri said homebuyers should have a sense of confidence that a building is structurally sound.

The responsibility has to be assumed by the builders themselves. If the builder has gone wrong, or he/she has not been able to check something, full recovery from that person is the minimum, as thousands of people get affected, he said.

Meanwhile, it was pointed out that some states have tweaked the provisions of RERA while framing rules under the Act by exempting the registration of ‘ongoing projects’.

In February, the Supreme Court directed the Centre to examine whether the rules framed by various states under the RERA are in conformity with the central legislation and subserve the interest of homebuyers.

“The fact of the matter is that you did not have a regulator and then you are bringing in the regulator, so everybody will try to stop it. When they found that we are resolute in our determination and they try to do something else, they tried to tweak it,” Puri said.

The minister said the Centre will place before the Supreme Court all the facts related to dilution of RERA Act by the state governments.

“I think we should place the fact squarely before the apex court that if all of us agree and some state do this (the dilution), we have enough persuasive power at our disposal to tell them this is not right. No dilution is a norm. Those who have diluted will have to justify why they have diluted. And we will not bring the whole template down just because you have diluted it,” Puri said.

In the meeting, it was also highlighted that all states/UTs have notified rules under RERA, except Nagaland which is in process to notify the rules.

As many as 31 states/UTs have set up Real Estate Regulatory Authority (Regular-25, Interim-6). States like Meghalaya, Sikkim, West Bengal and Union Territory of Ladakh are yet to establish the authority.

“The best thing about RERA is that it has come to be widely accepted in the country. And its success is anchored in the spirit of gradual but steady problem solving,” Puri said.

There are 30 members in the CAC panel which includes Niti Aayog CEO and secretaries of many ministries. President of homebuyers’ body Forum for Peoples’ Collective Efforts Abhay Upadhyay as well as presidents of realtors’ body CREDAI and Naredco are members of the council.

On the implementation of RERA Act by states, Upadhyay suggested that a committee should be formed, under the leadership of additional secretary, comprising all stakeholders to take up the issue with respective states. He said the suggestion of the FPCE (Forum for Peoples’ Collective Efforts) has been accepted.

Regarding tweaking of rules by states, Upadhyay suggested that necessary instructions should be given for compliance of the Supreme Court order in letter and spirit. The general rules for all states should also be reviewed along with ‘agreement for sales’ and placed before the apex court, he added.

FPCE has suggested that necessary directives should be issued to all states to ensure sufficient technical teams are provided to the regulatory authority to inspect every stage of construction at regular intervals to ensure structural safety and quality of construction.

Regarding constitution of committee of resolution of legacy stalled projects, Upadhyay said it was agreed to include FPCE as homebuyers’ representative in the proposed committee to look into this issue.

On the stalled projects, the CAC agenda highlighted that the Centre has established the Alternate Investment Fund (AIF)- Special Window for Affordable and Mid-Income Housing Fund (SWAMIH) investment fund of ₹25,000 crore to provide last mile funding for projects.

The fund is being provided to projects that are net-worth positive and registered under RERA, including those projects that have been declared as Non-Performing Assets (NPAs), or have pending proceedings before the National Company Law Tribunal (NCLT) under the Insolvency and Bankruptcy Code (IBC).

As on February 14 this year, 249 deals aggregating to ₹23,778 crore have been approved, and this will benefit more than 1,46,946 homebuyers and unlock projects worth ₹66,163 crore.

“It is evident that this fund has proved to be very instrumental in completing the legacy stalled projects, and is fulfilling the dreams of homebuyers who invested their lifetime savings in these legacy stalled projects which were launched before enactment of RERA,” the agenda said.

Accordingly, the CAC might advise the Centre to constitute a committee under the chairmanship of NITI Aayog CEO to deliberate on all the issues related to these legacy stalled projects holistically.

“The committee may comprise representatives from the Ministry of Finance, Ministry of Housing & Urban Affairs, sectors’ experts (dealing with stalled projects and insolvency proceedings) and give its recommendations to the central government within two months from date of its constitution,” the agenda said.

Source: https://www.hindustantimes.com/real-estate/states-should-not-dilute-rera-provisions-union-housing-minister-puri-101649844593293.html

The Central Advisory Council (CAC) meeting will constitute a committee for the resolution of legacy stalled projects and the issue of some states tweaking the provisions of RERA, while framing rules under the Act by exempting the registration of 'ongoing projects.' "The provisions may include a physical inspection of projects during construction, Structural Audit by reputed institutes on regular intervals, declaration of Structural Safety by promoter before applying for completion or occupancy certificate, etc. Central Advisory Council may consider,” according to the agenda.

Structural safety of real estate projects, changes in RERA provisions to figure in upcoming CAC meeting

The Central Advisory Council (CAC) meeting scheduled for April 12 will discuss issues relating to the structural safety of real estate projects following an incident of partial roof collapse in Gurugram wherein two women were killed.

The meeting will also deliberate on constituting a committee for the resolution of legacy stalled projects and the issue of some states tweaking the provisions of RERA, while framing rules under the Act by exempting the registration of ‘ongoing projects.’

The CAC, set up by the government for effective implementation of the Real Estate (Regulation and Development) Act, 2016 (RERA), will hold its third meeting on April 12. The first two meetings of the CAC were held on May 14, 2018, and April 29, 2020.

The council, chaired by Housing and Urban Affairs Minister Hardeep Singh Puri, will consider measures like physical inspection of projects during construction and structural audit at regular intervals by reputed institutes.

“Recently, there have been reports of incidents related to structural safety in multistorey apartments. Though, RERA mandates the promoters to rectify the structural defects highlighted within a period of 5 years from the date of possession, some provisions related to structural safety may be deliberated to ensure further safety of high-rise buildings and to prevent loss of life and property.

“These provisions may include a physical inspection of projects during construction, Structural Audit by reputed institutes on regular intervals, declaration of Structural Safety by promoter before applying for completion or occupancy certificate, etc. Central Advisory Council may consider,” according to the agenda.

The committee may comprise representatives from the Ministry of Finance, Ministry of Housing and Urban Affairs, sector experts (dealing with stalled projects and insolvency proceedings) and give its recommendations to the central government within two months from the date of its constitution, the agenda said.

“Central government established the Alternative Investment Fund (AIF)- Special Window for Affordable and Mid-Income Housing Fund (SWAMIH) Investment Fund of Rs 25,000 crore to provide last mile funding for projects that are net-worth positive and registered under RERA, including those projects that have been declared as Non-Performing Assets (NPAs) or are pending proceedings before the National Company Law Tribunal (NCLT) under Insolvency and Bankruptcy Code (IBC),” it said.

“As of February 14, 2022, 249 deals aggregating to ₹23,778 crore were approved which will benefit more than 1,46,946 homebuyers and unlock projects worth ₹66,163 crore,” it said.

It is evident that this fund has proved to be very instrumental in completing the legacy stalled projects and is fulfilling the dreams of homebuyers, who invested their life savings in these legacy stalled projects, which were launched before the enactment of RERA, it said.

The third meeting of the CAC will also discuss the issue of tweaking RERA provisions by some states. The CAC agenda noted that all states/UTs have notified rules under RERA except Nagaland, which is in the process to notify the rules.

As many as 31 states/UTs have set up Real Estate Regulatory Authority (Regular-25, Interim-06). States like Meghalaya, Sikkim, West Bengal, and UT of Ladakh are yet to establish authority.

In the agenda, it was pointed out that some states have tweaked the provisions of RERA while framing rules under the Act by exempting the registration of ‘ongoing projects. The matter was taken up by the housing ministry on several occasions and through various communications.

The CAC in its first meeting deliberated upon the issue of dilution by the states while framing rules under the Act. As decided in the meeting, the ministry has taken up the matter through various communications.

Homebuyers’ body Forum for People’s Collective Efforts (FPCE) president Abhay Upadhyay said in a statement that the agenda for the upcoming CAC meeting shows that the Ministry of Housing and Urban Affairs is serious and keen to address all major concerns not only in the implementation of RERA but also in providing resolution for incomplete legacy stalled projects started before RERA came into force.

“We have been raising the issue of dilution in RERA Rules by the states due to which many incomplete projects were left out of the ambit of RERA and also that RERA Authorities are unable to enforce their own orders due to which RERA orders became nothing more than a piece of paper.

“The recent incident of poor construction quality leading to loss of lives will also be part of the discussion,” Upadhyay said.

The proposal to form a committee under the Chairmanship of CEO, NITI Ayog is also welcome and shows that the government is keen to ensure the completion of remaining incomplete stalled legacy projects, he said.

“We have also come to know that the Ministry has accepted our suggestion to live stream the proceedings of the CAC meeting on social media platforms to ensure complete transparency,” Upadhyay added.

Source: https://www.moneycontrol.com/news/business/real-estate/structural-safety-of-real-estate-projects-changes-in-rera-provisions-to-figure-in-upcoming-cac-meeting-8297181.html

The Supreme Court directed the Centre to examine whether the rules framed by various states under the Real Estate (Regulation and Development) Act, 2016 (RERA) are in conformity with the central legislation and subserve the interest of homebuyers.

RERA implementation to improve post SC direction on examining states’ rules: FPCE

Homebuyers’ apex body FPCE expects the implementation of realty law RERA to improve following the Supreme Court’s recent direction to the Centre to examine the rules framed by states and see whether those subserve the consumers’ interest.

Last month, the Supreme Court directed the Centre to examine whether the rules framed by various states under the Real Estate (Regulation and Development) Act, 2016 (RERA) are in conformity with the central legislation and subserve the interest of homebuyers.

A bench of Justices D Y Chandrachud and Surya Kant gave three months to the Centre to examine if there are any deviations between the rules drawn up by the states and those framed by the Centre in 2016, and to place the report by the first week of May 2022.

When contacted, Forum for People’s Collective Efforts’ (FPCE) President Abhay Kumar Upadhyay said: “Despite five years of its full implementation, RERA is yet to reach anywhere near its intended objective.”

The prime reason for this is that the states to whom responsibility has been given for its implementation did not follow any uniformity in their general real estate rules and rules for agreement for sale, he pointed out.

“Their (states’) rules were not within the four corners of the provisions of RERA. This took sting out of the Act and homebuyers were deprived of the benefits of RERA,” Upadhyay said.

On the other hand, the association’s president said, builders took full advantage of this and the fear of RERA catching them faded.

“In view of this, though late, but still this ruling from the Supreme Court will set things right going forward and many homebuyers will then reap the benefit,” he added.

Most importantly, this ruling would break the belief in most builders that they are above the law or that they can take the law for granted, he said.

“I sincerely hope that both the ministry to whom the task has been assigned directly and also the Amicus who has also been given responsibility will devote sufficient time and report not only all deviations but also missing content which may have left loopholes in the implementation of RERA,” Upadhyay said.

This order has once again raised the hopes of homebuyers that they will get justice sooner than later, he added.

Colliers India CEO Ramesh Nair said the Supreme Court’s decree to scrutinise RERA rules of states is significant as there is a lack of uniformity in builder-buyer agreements across RERA rules of various states.

“This directive will help bring accountability and transparency in dealings between homebuyers and developers in several cases,” he said.

The anomalies mainly existed with respect to the payment schedule, delivery schedule and associated delays, as well as liability towards structural defects, Nair pointed out.

“A uniform builder-buyer agreement will also lead to more confidence amongst homebuyers. It will instill trust in homebuyers, without the fear of any unwarranted liabilities,” Nair said.

Homebuyers would also have more faith in developers across the spectrum, and even in under-construction projects, the Colliers India CEO said.

Source: https://realty.economictimes.indiatimes.com/news/industry/rera-implementation-to-improve-post-sc-direction-on-examining-states-rules-fpce/90181477

The Supreme Court has directed developers to deposit either full compensation and interest imposed by the regulatory body or at least 30 per cent of the penalty as a pre-condition to challenging any RERA order.

Supreme Court ruling binding builders to pay before challenging RERA order a welcome move

Developers now may have to think twice before challenging Real Estate Regulatory Authority (RERA) orders as the Supreme Court has directed that developers should either deposit full compensation and interest imposed by the regulatory body or at least 30 per cent of the penalty before they can challenge the order before the appellate authority. Professionals practising in MahaRERA welcomed the SC decision and said the order has hit the nail on the head by ensuring that flat owners get justice and do not fall prey to the delaying tactics often adopted by the builders by challenging such orders.

CA Ramesh Prabhu, founder chairman of MahaSEWA (Maharashtra Societies Welfare Association), said, “This is a landmark and welcome decision passed by the Supreme Court. Now the promoters will think many times before the appeal is filed. Now they may decide to file the appeal if they are sure of winning. Appeals by promoters will come down drastically. The judgement has put all the doubts to rest. Even the appellate tribunal will not be able to proceed to admit the appeals of the promoter unless 100 per cent of the amount is deposited.”

“However, if the allottees are aggrieved against the order of authority or adjudication officer, the appeal may be filed without depositing any amount. This also becomes a great deterrent to the promoters to file the appeal. Therefore, now we find most of the promoters try to settle the dispute out of court as soon as complaints are filed,” Prabhu said.

Solicitor Stuti Galiya said, “It is a well known fact that builder lobbies have abundant legal and financial resources and they often create separate legal budgets for each project. Hence, it is seen that most of the time, developers/builders do not take the legal action against them seriously, as they believe that they could easily get through by stretching the matter in various forums for years and years. This often results in justice being denied to flat owners as they often are not able to fight such a long legal battle, for financial and time constraints. This judgement has hit the nail on the head by ensuring that flat owners get justice and do not fall prey to the delaying tactics. This is certainly a positive and welcome move in the right direction.”

Advocate Godfrey Pimenta, who practises in MahaRERA, said, “The Supreme Court judgement only endorses section 40(1) of the Real Estate (Regulation and Development) Act, 2016 that the amount invested by the allottees, which is often their life savings, along with the interest thereon as quantified by the regulatory authority or the adjudicating officer, can be recovered as arrears of land revenue by them from the builders. However, the practical difficulty faced by the flat buyers is the laborious process in attaching the properties of the developer.”

Advocate Vinod Sampat, founder president of Flat Users Residents Welfare Association, said, “The said judgement is a big boost to flat purchasers. Builders who delay construction or the project for one reason or other will have to refund the principal amount and interest to defaulted flat buyers. It is common knowledge that delaying tactics are adopted by both builders and as well as their advocates. The approach of the court to insist on the deposit before accepting an appeal is a welcome move.”

The case

Newtech Promoters and Developers Private Limited v State of Uttar Pradesh and others is a case where the flat buyer filed a complaint against the developer for non-compliance of possession of flat within the stipulated time period, as per the agreement. The complainant had booked a flat by paying a consideration of Rs 28.21 lakh on October 4, 2012, and the possession, as per the agreement, was to be given by 2015. However, when the developer failed, the buyer moved the complaint demanding refund of Rs 28.21 lakh with interest.

The state RERA authority found the complainant’s claims to be true and accordingly on April 5, 2019 passed an order directing the developer to refund the principal amount of Rs 28.21 lakh along with interest of Rs 19.82 lakh. The developer, instead of executing the RERA order, moved a writ petition challenging the same including the recovery certificate dated September 8, 2020 holding it to be without jurisdiction as it has been passed by a single member of RERA. The developer claimed the single member had no jurisdiction to pass such an order. However, the SC set aside the developer’s plea and passed the landmark verdict.

Source: https://www.mid-day.com/mumbai/mumbai-news/article/supreme-court-ruling-binding-builders-to-pay-before-challenging-rera-order-a-welcome-move-23208089

Four and a half years since RERA Act came into force, Maharashtra continues to lead the country in terms of projects registered.

RERA has brought discipline to real estate sector but needs more teeth, say experts

Four and a half years since Real Estate Regulatory and Development Act came into force, Maharashtra continues to lead the country in terms of projects registered. Experts, though, say that the Act, which has brought about discipline into the real estate sector, needs more teeth and manpower to plug its loopholes.

Analysis by Anarock — a real estate consultancy firm – showed that across the country, 71,307 projects have been registered with the regulator. Maharashtra has reported the highest registration with 31,664 projects, followed by Gujarat (9,272) and Karnataka (4,497), respectively.

In terms of grievance redressal of homebuyers, as many as 78,903 cases have been disposed so far by various state and Union Territory (UT) regulatory authorities. Uttar Pradesh and Haryana have disposed the highest number of cases, accounting for an approximately 61% share of total disposed cases. “UP saw 30,990 cases disposed, and Haryana nearly 16,864 cases, as per the latest progress report released by the Ministry of Housing and Urban Affairs,” the report read.

All states, except Nagaland, the report said, notified rules under Rera act; the northeastern state is in the process of doing so.

As many as 30 states and UTs have set up their Real Estate Regulatory Authority (RERA) of which Jammu & Kashmir, Ladakh, Meghalaya, Sikkim and West Bengal have notified their rules but are yet to establish their authorities. Besides, 28 states have set up Appellate Tribunals with Arunachal Pradesh, J&K, Ladakh, Meghalaya, Mizoram, Sikkim and West Bengal under the process of establishing the same.

On the loopholes in the law, Prakash Thakur, head of research team of Anarock, said manpower shortage is one of the major concerns for the authority. The Act specifies regular updating of sales report and project reports but that rarely happens, he said. Also, the authority does not have an efficient way to check the documents, which are uploaded on the website by the realtors, he added. Thakur said the mere regulatory nature of the authority does leave a gap in implementation of the orders of the RERA.

Both Thakur and Anuj Puri,chairman of Anarock Group, were quick to point out that the judiciary has stepped in to plug some of the loopholes that have been felt in the act. Recently, the Supreme Court upheld the jurisdiction of the Real Estate (Regulation & Development) Act, 2016 on all realty projects that were ongoing and had not received completion certificates until the law came into effect. This means that states that had diluted the provisions and did not include several under-construction projects under RERA’s ambit are now expected to do so.

As a result, we may see increased number of residential projects being completed in times to come,” said Puri. “Many developers with under-construction projects outside RERA had focused their resources on projects that did come under its ambit. This is no longer an option. The number of heavily delayed and even stalled units is likely to reduce. As per Anarock data, as of July 2021, nearly 6.29 lakh housing units launched in 2014 or before were incomplete or stalled across the top seven cities,” he added.

Source: https://indianexpress.com/article/cities/pune/rera-has-brought-discipline-to-real-estate-sector-but-needs-more-teeth-say-experts-7648221/

PM Narendra Modi emphasised that RERA Act has helped in getting the entire housing sector out of mistrust, fraud and helped & empowered all stakeholders.

RERA has brought housing sector out of fraud and mistrust: PM Modi

Prime Minister Narendra Modi on Tuesday. said that the Real Estate Regulatory Authority (RERA) Act has helped overcome serious problems of the urban middle class as regards home buying.

Inaugurating the Azadi@75 – New Urban India: Transforming Urban Landscape conference-cum-expo in Lucknow, Modi emphasised that RERA Act has helped in getting the entire housing sector out of mistrust and fraud and helped and empowered all stakeholders.

Modi also said that urban bodies are also saving about ₹1,000 crore every year by installing LED street lights. Now this amount, he informed, is being used for other development works. He added that LED has also greatly reduced the electricity bill of the people living in the city.

He also digitally handed over keys of Pradhan Mantri Awas Yojana – Urban (PMAY-U) houses to 75,000 beneficiaries in 75 districts of Uttar Pradesh during the event.

In addition to this, Modi laid the foundation stone of 75 Urban Development Projects of Uttar Pradesh under Smart Cities Mission and AMRUT. This event also saw flagging off of 75 buses under FAME-II for seven cities including Lucknow, Kanpur, Varanasi, Prayagraj, Gorakhpur, Jhansi and Ghaziabad.

Stressing on the massive increase in the number of houses constructed under PM Awas Yojana as compared to previous numbers. Modi informed that more than 1.13 crore housing units have been constructed in the cities and, out of this, more than 50 lakh houses have already been built and handed over to the poor.

Taking a jibe at earlier governments for dragging their feet on implementing the schemes. Modi said that more than 18,000 houses were approved but not even 18 houses were constructed at that time. He said that now more than 9 lakh housing units were handed over to the urban poor and 14 lakh units are under various stages of construction.

Source: https://www.thehindubusinessline.com/news/real-estate/rera-has-brought-housing-sector-out-of-fraud-and-mistrust-pm-modi/article36842379.ece

Since the enactment of real estate regulation law, RERA, and establishment of regulatory authorities across states, a total of 67313 projects have been registered in the country, 46% of them in Maharashtra alone.

Over 67k projects registered under RERA, homebuyers say just tracking registration not enough

Since the enactment of real estate regulation law, RERA, and establishment of regulatory authorities across states, a total of 67,313 projects have been registered in the country , 46% of them in Maharashtra alone. The western state also leads the list so far as registration of property agents is concerned while Uttar Pradesh tops among states in several complaints disposed of by regulators.

Official data till July 10 show that 31,221 projects have been registered with the RERA in Maharashtra, followed by 8,685 in Gujarat. Karnataka has the third maximum number of projects registered with RERA at 4,151. The UP RERA has registered 3,033 projects and the tally in Madhya Pradesh is 3,659.

So far as the registration of real estate agents or property dealers is concerned, out of the total 51,895 registrations across states, Maharashtra alone has registered 29,995 of them. In UP, 4,579 such agents have been registered while Delhi has registered barely 389 agents.

The data also shows that so far 70,001 complaints have been resolved by the regulators with two benches of UP RERA leading the list having disposed of 27,825 complaints. Haryana, which has also set up two benches, has reported disposal of 14,591 complaints, followed by Maharashtra where 10,043 complaints have been resolved.

Abhay Upadhyay, who heads the Forum for People’s Collective Efforts (FPCE), a group that campaigned for the enactment of the RERA, said, “Merely tracking the number of projects registered under RERA is not of much significance especially after five years. We need to seek data like the number of projects completed within the scheduled date as per registration, number of projects granted an extension and completed within an extended period, number of projects delayed beyond one year from original scheduled completion and number of projects for which registration expired and extension also not sought by the promoter to assess the real success and effectiveness of RERA.”

He added similarly, the number of complaints disposed of by RERA authorities is of not much importance. To gauge the effectiveness of RERA, there is a need to know how many promoters have obeyed the orders of RERA, Upadhyay said.

“The RERA Authorities must disclose the number of refund orders passed by them and an actual number of refunds received by the complainants. On the same lines, they also must disclose how many promoters have obeyed their orders about handover, completion of facilities and amenities and lastly how many have paid penalty if any levied. Till such details are made available by the authorities, the actual impact of RERA cannot be gauged,” he said.

Source: https://timesofindia.indiatimes.com/india/over-67k-projects-registered-under-rera-homebuyers-say-just-tracking-registration-not-enough/articleshow/84532767.cms

Buying a house is one the biggest investments you will make in your lifetime. A wrong property choice, can land you in big trouble. You can check all details of developers.

Planning to buy a house? Get all details about the developer from these sources

Buying a house is one the biggest investments you will make in your lifetime. A wrong property choice or decision, especially in the case of under-construction property, can land you in big trouble. Many homebuyers are waiting for more than decade to get possession of their houses. Numerous projects either got shelved or stalled in between, after accepting significant payments were made by buyers. There is no sign of refunds even after years fighting court cases.

So, to minimize the risk, here are few sources of information that you should tap, before taking the leap.

The RERA website: The real estate (regulation and development) Act, 2016 makes it mandatory for the developer, its projects and agents to obtain a registration number. Each project should have a separate registration number and the same should be mentioned in all advertisements and communications with the buyers. The first step should be to cross-verify the RERA registration, on the RERA website of the respective state.

“Homebuyers can log in to the RERA website and check a promoter’s details including name, contact information and project details of the past five years. This will help buyers understand the competency of the builder,” says Anupam Rastogi, Co-Founder and Head-NRI Sales, Square Yards.

“One also has access to project details such as project name, type, address, project area, approving authority, parking area, project status, estimated cost of construction, completion year and total project cost. Homebuyers should carefully check the details of construction work done under the ‘project status’ section. Information such as the extent of development pending, total amount collected from allottees, amount invested in the project, delay in projects, reasons for delays and expected completion date are indicators of the developer’s credibility and thus must be duly scrutinized,” added Rastogi.

Beside these, you should also check whether all the required approvals and permission to build and complete the project are available; a developer is required to upload and update all these documents on RERA website on a regular basis. Developers are also required to upload details of any cases filed against them, make sure you collect at all this information.

Financials and annual report: A lot of homebuyers are suffering because of financial mismanagement and siphoning of funds that developers indulged in during the past. Therefore, financial scrutiny and due diligence are a must. “Whether or not the project will be delayed and have the same quality as the builder promised initially depends entirely on how financially stable the builder is. This is why having a clear understanding of your builder’s monetary position is important. While the financial health of a listed builder is easy to gauge by gathering all the information they share with the stock exchanges, doing so might be difficult in case of unlisted players,” says Mani Rangarajan, Group COO, Housing.com, Makaan.com and Proptiger.com.

“It is imperative for homebuyers to verify the financial status of a real estate developer to get an idea about its balance sheet, legality of the project and whether it has defaulted on loan payments for banks, which in turn can save buyers from future project completion harassments,” says Rastogi.

If a developer is not listed, there are other ways to check the financials as well. “For other developers, buyers can get their financial information on the Ministry of Corporate Affairs (MCA) website, in the ‘view public documents’ section. Homebuyers can also check the website of the Central Registry of Securitisation Asset Reconstruction and Security Interest of India (CERSAI) to check whether the property is mortgaged with any bank or housing finance company,” says Rastogi.

Visit previous projects: It is good to have feedback on construction quality and after-sales services from homebuyers who are already living in the projects developed by the builder. “Property owners here will be able to share their experience with the builder, helping you gauge what is in store for you if you were to invest in a property developed by the builder,” says Rangarajan.

“Homebuyers can get a sound idea about the quality of materials used in construction, kind of fittings and electrical equipment used, the type of amenities on offer and whether the amenities are charged separately, or cost is included in total cost of the apartment,” says Rastogi.

Explore newspapers and social media: Newspapers and social media platforms such as Facebook, Twitter and LinkedIn and so on can help you get first-hand information. “Today, social media platforms act as a great tool that empower homebuyers by quick dissemination of information. The same has remained true of the media for a long time. A buyer who is looking to invest must get in touch with property owners and prospective buyers through social media to inquire about builders and housing projects. They must also follow real estate news in the media to have a better understanding of the sector in general and developers in particular,” says Rangarajan.

Feedback of homebuyers can help you make a good decision. “Social media sites are a perfect medium to read about client testimonials and homebuyers’ satisfaction stories,” says Rastogi.

Never make a property buying decision in a hurry or under the influence of any pressure tactics of the developer’s representative or real estate agent.

Ask for written documents or emails of all the claims and promises made by the developer or real estate agent.

Source: https://www.moneycontrol.com/news/business/personal-finance/planning-to-buy-a-house-get-all-details-about-the-developer-from-these-sources-7100991.html