real estate bill passed in rajya sabha
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3/19/2016 Real Estate Bill passed in Rajya Sabha
http://www.realtynmore.com/realestatebillpassedinrajyasabha/ 1/7
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Real Estate Bill passed in Rajya Sabhaby Chhavi Vashishtha 1 week ago
The Rajya Sabha on Thursday passed the Real
Estate (Regulation & Development) Bill. The Bill
aimed to regulate India’s real estate sector, will
help in protecting home buyers’ rights by
bringing in transparency.
The Government expedited the passage of the
Bill in the Upper House after renewed interest
shown by the Congress, after its Vice President
Rahul Gandhi, who told concerned home
buyers last week that his party will support the Bill. The Congress party also wrote to the PM,
urging to prioritise the Bill in the ongoing Budget session of the Parliament.
Based on the feedback of a parliamentary committee, the Government included 20
amendments to the Bill, which was rejected by the Rajya Sabha last year.
The Real Estate (Regulation and Development) Bill makes it mandatory for residential and
commercial projects to be registered with the real estate regulator which will monitor
transactions and also settle disputes. The Bill becomes very significant in the wake of the
increasing number of delayed projects in recent years.
The Bill proposes to cover a larger number of projects for registration – any project including
eight flats or 500 square metre will come under the purview of the Bill.
Real estate developers will have to deposit at least 70 per cent of money collected from
buyers in an escrow account to meet construction costs, compared with the earlier proposal
for 50 per cent. This is to ensure that developers do not run out of cash during the
construction of the projects. The Bill also stipulates builders to pay interest to home buyers
for any default or delays at the same rate they charge the buyers on delayed payments.
For any structural defects instead of two years proposed initially, the developers will now be
liable for five years.
Real estate sector’s reaction to RERA Bill
UNION BUDGET 2016-17
Overall direction positive,but few facets ignoredAman Nagar | | Paras Buildtech
Disappointing forindustry mainly for sectorRK Arora | | Supertech
Relief to housing sectorhopes not metDeepak Kapoor | | Gulshan Homz
Focused on some keyissues which is positiveManoj Gaur | | Gaursons
The Union Budget augerswell for real estate sectorShishir Baijal | | Knight Frank India
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3/19/2016 Real Estate Bill passed in Rajya Sabha
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Kashi Nath Shukla Chairman MD Tashee Group Tashee Group,“The new version of the Real Estate Regulatory Bill will bring more
transparency to the sector that balances the currently skewed builder
buyer power equations. The Bill is indeed a powerful means to make
the chronically opaque Indian real estate sector more transparent. It
will also boost domestic and foreign investors to help promote private participation to
achieve the target of Housing for all.”
Aman Singh Gehlot, Director, Ambience Group said, “We do
welcome the setting up of regulatory authority for the real estate
sector. The buyer confidence, which was shaken, will now come back
with this crucial step taken by the Govt of passing the Real Estate Bill
today. The real estate market, which has been plagued by numerous
problems like approval hurdles and delay in projects, will also
improve. The regulatory bill will play an integral role in not only in safeguarding interests
of buyers/ investors but also of developers across the nation and ensure consistent
growth for real estate industry.”
Gaurav Gupta, General Secretary, credai RNE said, “The realestate Bill seeks to address some major concerns of the industry
and protecting the interests of homebuyers. The Bill would
improve the customer sentiments as the Bill includes measures to
ensure buyers protection and standardisation of business
practices. The Bill will be a watchdog for the malpractices and
fraudulent activities of the sector. Overall the bill will be of great help to both the buyers
and builders. However approval authorities should also be bring in the ambit of bill as
many times they are responsible for project delays. The provisions like depositing 70 per
cent of the receivables in escrow account, bringing commercial segment under the Bill,
establishing state level regulatory authorities, interest on delayed possessions etc would
help home buyers in a big way.”
Manoj Gaur, President credai NCR & MD, Gaursons India Ltd.said, “The need for real estate Bill has been felt since long time in
this unorganised sector. This is an important development
towards the regulation of realty sector and to provide relief to the
homebuyers. The amendments which were made to the bill last
year aimed to promote transparency, greater accountability,
protection of homebuyers & investors, and efficient working in the
sector. The passage of bill will also result in authentic players remaining in the market and
noncredible ones exiting due to stringent checks that would be brought by the bill. But it
is also important that the bill needs to be a balanced one which is agreed upon by both
buyers as well as builders. It is important to fix the accountability of approving authorities.
This is important step towards avoiding delays. Bringing government agencies and
authorities under its ambit would be beneficial to developers too. This would ensure that
there will be a dedicated authority to deal with all the grievances. Overall, the bill once
implemented will boost customer confidence and change the complete gamut of real
estate workings”.
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3/19/2016 Real Estate Bill passed in Rajya Sabha
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Prashant Tiwari, Chairman, Prateek Group said, “The Bill oncemade a law will not only protect property buyers but will also
boost investments in the sector. As the Govt has already brought
amendments in the Bill like regulating both commercial and
residential properties, maintaining an escrow account, establish
fast track dispute resolution mechanisms for consumer
grievances, preventing builders to make changes in layouts and plans etc. The builder
community will also be benefitted as the bill would promote fair play in realty transactions.
This would also help in distinguishing the work of sincere ones and the fraudsters. The
law will be a brand builder for those developers who are genuine and work to deliver
quality projects in specified timelines.”
Om Chaudhry, Founder & CEO of FIRE Capital and Chairman& CEO of Astrum Value Homes said, “Real estate Bill will helpimprove the sentiments of home buyers by boosting their
confidence level and making them more comfortable while buying
properties. The property buyers would rest assured as a result of
the protection provided from any possible exploitation in the
hands of builders. Measures like depositing part of the sale
proceeds in an escrow account, interest on delays in project completion, time limits for
resolving customer complaints etc. would bring muchneeded relief to the homebuyers.
The Bill will bring more transparency in the working of the sector by promoting
professionalism and standardisation of industry practices. Along with improved customer
outlook and enhanced growth, the sector will also witness a better working environment
for builders too. Besides implementing the Bill, Govt should also bring out some
administrative reforms to speed up approval processes to avoid project completion
delays”.
Deepak Kapoor, President credai Western UP said, “Onceimplemented, the Real Estate Regulatory Bill will not only change
the way real estate works but will also be beneficial to all the
concerned stakeholders. The bill will act as a protector of home
buyer’s interest and will help in building such brands in the market which will be known for
quality and timely deliveries. There are key features of the bill like maintaining an escrow
account by builders, barring developers from making changes in the construction plans
etc which will are in the interest of customers. The regulator will also bring some
consolidation between organized and unorganized players in the market, boosting the
confidence level of customers. The bill is welcomed to become a law but it must be fair in
nature as well to avoid hindrances and confusions.”
Sanjay Rastogi, Director, Saviour Builders Pvt. Ltd. said, “TheReal Estate and Regulatory Bill, as the name suggests would be
a regulator of the entire real estate sector which at present is
unorganised. Real estate bill will be a welcome move, as it will not
only change the way how real estate sector functions but on the
other hand it will also benefit all the parties involved in realty
transactions. The Bill will bring uniformity and transparency in the
R&M Property Awards 201516
3/19/2016 Real Estate Bill passed in Rajya Sabha
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working of the sector. To protect home buyers interest, the Bill has several clauses to
bring the muchneeded relief to the stressed customers. By bringing in some strict rulings,
the Bill will also make shady and treacherous builders to move out of the market”.
Arvind Jain, Managing Director – Pride Group, said, “The realestate regulatory Bill has been long in the pipeline, and has now
cleared all roadblocks and become a law. Various decision
makers involved in it had been ambiguous about their stance
towards this vital regulator, and as a result it remained pending.
Now, it has finally received the green signal and is all set to
revolutionise the Indian realty market. It will empower consumers by giving them
confidence while making their real estate investments. It imposes strict regulations on how
developers conduct their business, and underwent various redrafts aimed at doing this. It
is very encouraging that the bill is now a reality.”
Kishor Pate, CMD – Amit Enterprises Housing Ltd, said, “Thereal estate needed the Real Estate Regulatory Bill more than any
other single piece of legislation, even though GST, the Land
Aquisition and Rehabilitation Bill, single window clearance and
industry status are by now means of less importance. The
industry has been in express need of an apex body via which all
concerns of consumers can be addressed transparently and
efficiently. We will now see a radical transformation of the entire residential sector. Strict
enforcement of project delivery timelines, verifiable construction quality and assurance of
legal clearances will finally become a reality, and the consumer confidence which had all
but evaporated will return. It is a most welcome development.”
Anil Pharande, Chairman – Pharande Spaces said, “The Indianreal estate sector has historically been unregulated and
disorganised. Unfortunately, the unorganised segment has so far
represented the largest share of the market, and it is in this
segment that consumers have in innumerable cases been held
hostage to by unscrupulous practices of ruthless developers. The
real estate regulatory bill was drafted with a vision to give clarity and assurance to real
estate buyers via various strictures. Now that it has become an enforceable law, it will
have a profoundly positive effect on how both domestic and global investors view Indian
real estate. More importantly, it will give homebuyers a strong measure of assurance.”
RK Arora, Chairman, Supertech Ltd., & Member credai,said,”The Real Estate Regulator Bill passed today by the
Parliament is a significant step towards bringing transparency and
financial discipline in real estate sector and it would secure the
interests of homebuyers. The legislation would definitely provide
clarity to the buyers on various aspects of housing projects at the
time of investing in the project as it is mandatory for the developer
to post in advance all information on issues such as project plan, layout, government
3/19/2016 Real Estate Bill passed in Rajya Sabha
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approvals, land title status, contractors to the project, schedule for completion with the
State Real Estate Regulatory Authority. It is also a welcome step that the Regulator will
promote single window clearances which is vital for the timely implementation and
delivery of projects. Further, the provision for giving infrastructure status to the industry
would bring confidence to the real estate sector and the industry. We welcome the new
legislation”
Dhruv Agarwala, CEO & founder, PropTiger.com, said, “As asector that lacks clarity and is riddled with legal disputes between
consumers and developers, passage of Real Estate Regulatory
Bill comes across as a much needed wave of hope. Delayed
possession of properties has been a major cause of trust deficit in
the space and has kept potential consumers away for a long time
in case of long term projects. However, Statelevel Real Estate Regulatory Authorities
(RERAs) are now expected to ensure timely completion and handover. Homebuyers will
be able to know the status of the land, site and layout plan, schedule for completion, and
details on approvals from various Government agencies which will lead to increase in trust
which in turn could lead to a revival in the sector.
Further, clarity on carpet area would eliminate a major concern area. However, the Bill has
its share of shortcomings as well. It includes a provision for developers to maintain 70 per
cent of the money collected from buyers in an escrow account towards cost of
construction. But what if the cost of land is more than 30 per cent and cost of construction
lower than 70 per cent? In large Indian cities, land is very expensive, and this is often the
case. When this happens, funds collected from homebuyers may not be utilised, and
developers may be forced to raise funds from other sources. But apart from some minor
points, which would need further discussion the bill would certainly be of great help in
protecting the interest of buyers and bring more transparency to the sector by making
developers as well as intermediaries more accountable.”
Prashant Solomon, Managing Director, Chintels, said, “I welcomethe idea of a regulator as this will lead to better transparency in the
industry. What I am not happy about is that the government authorities
have not been included in this bill. We know that many delays in the
projects happen because of the tedious nature of getting approvals. In the long run unless
govt. authorities are not regulated this will not benefit the end users or developers.
Kushagr Ansal, Director, Ansal Housing said, “We are now just
one step away from receiving probably the biggest news for the
real estate sector with Lok Sabha to give a final word on it.
Developers will now have to park 70 percent of the amount
collected from the buyers of the project in a separate bank
account. Also, marketing and selling of the projects will be based
on carpet area basis and not super area basis, thus justifying the
amount which the buyers pay for a property.”
3/19/2016 Real Estate Bill passed in Rajya Sabha
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Ashok Gupta, CMD, Ajnara India Ltd. said, “It is very imperativeto understand that the demand and respect of real estate sector
has been moving downward for several years now attributing to
the negatives pertaining in this sector such as fraud committed by
several builders, possession delays and absence of a monitoring body, and this will
continue if proper action is not taken. With this bill in place, every state will have a
regulator who will be continuously supervising and monitoring. Moreover, the projects will
now be completed on time and developers will have to submit all the layouts, plans and
documents with the regulator who will ensure transparency and hence, customers will feel
more secure while transacting.”
Amit Modi, Director, ABA Corp and Vice President CredaiWestern UP said, “A regulator to curb malpractices in the realestate sector is welcome hence we whole heartedly welcome this
Bill but we still feel a law without making all the stakeholders
concerned accountable, will not be able to help the purpose at
large. Projects are often delayed due to graft in the issuance of
permits and clearances.
Government agencies issuing permits should be brought under the law and made
accountable for undue delays. On an average it takes 23 years to start a project after
land is acquired; by this time the cost of land rises by 2430 per cent due to hefty interest
payments as bank loans are not available for procuring important raw material in this
sector. The added cost ultimately gets passed on to the customer. These costs can be
curtailed and passed on to the consumer, if developers can start building faster and also
deliver larger volumes quicker for the consumer.
Harshvardhan Neotia, President, Ficci, said, “The passing of RealEstate Bill, 2016 in Rajya Sabha is a landmark step towards
enhancing the credibility of construction industry by bringing in
transparency and accountability in execution of projects. I hope this
bill will put in place an effective regulatory mechanism that would
safeguard the interest of consumers as well as provide protection against fly by night
operators. The passing of bill should enable timely approval and execution of projects
which will raise the confidence of consumers and also give a huge boost to the growth of
real estate sector.”
Manoj Kumar Singh,Chairman,Mangalya Group said, “We welcome
the successful passage of the Real Estate (Regulation and
Development) Bill in Parliament. The legislation will go a long way in
reducing frauds and malpractices indulged in by unscrupulous realty
players. It will act as a major deterrent to flybynight operators who
bring a bad name to the sector. By bringing in transparency and best
practices in the real estate sector, the regulatory Bill will safeguard the interest of both the
buyers as well as the developers. We hope now the property market will gain the much
desired momentum with renewed interest and trust of buyers in realty projects.”
3/19/2016 Real Estate Bill passed in Rajya Sabha
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Anita Arjundas, MD, Mahindra Lifespace said, ‘We welcome the
passage of the Real Estate Bill, which seeks to restore buyer confidence
with a strong thrust on transparency and accountability. Speedy action
on single window approvals will enable more efficient use of capital and
also support timely delivery.’
“We appeal to the government for the faster proceeding in the matter as
the Bill has already been delayed by many years. Also, it seems, that the
clause to deposit 70 per cent of the funds received from buyers would
definitely pose financial challenge for builders,” opines Praveen Jain,President, NAREDCO.
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