There have been many occasions when the new home buyers have complaint about lack of transparency in the real estate sector. Happykeys examines five such laws and measures announced recently that could bring transparency and give more power to property buyers.
Market expert say that the enforcement of new decisions and laws in the real estate are promising and may bring good days in the property market. Several events and trends taking shape now could bring more transparency in the real estate transaction that will help genuine home buyers. Black money would possibly be out from housing segment where many developers and resellers use to park their money. Further, government has announced four measures that can inject new life and confidence in the realty market. These measures are:
Impact of the Real Estate Regulation Act (RERA)
With the enforcement of RERA Act, new home buyers will go for purchasing homes without any apprehension of being cheated. This law brings more credibility to the realty industry. The Act will lead to institutional reforms in land acquisition, approval processes and taxation that are much needed to ensure crystal clear transaction in real estate.
“The Act will make realty sector more institutionalised and benefit organised players. The shorter timelines for a given project will ensure speedy and more stringent completion. Government authorities should also be made accountable for time-bound approvals,” says Dr Anil Jindal, chairman, SRS Group.
Goods and Services Tax (GST)
The enactment of Goods and Service Tax (GST) will remove multiple tax system, reducing input cost for all realty players. “The implementation of GST would boost transparency and standardisation in real estate sector. The advantages can be huge, especially to new home buyers. GST will replace multiple taxation system with a single tax bringing down the cost of construction i.e. all the multiple taxes on procurement side would be replaced by GST”, says, Sushant Mutreja, Chairman, Cosmic Group, India.
The latest central government’s decision to ban currency notes of Rs. 500 and Rs. 1,000 promise the much-needed transparency in the property market.
“This is one of the best decisions taken by the union government which will also go in the favor of real estate market. This action will continue to have a positive impact on the realty market and end users are going to benefit in the long run. The action will boost the sentiments of home buyers”, avers, Vikas Pudir, CMD, SKB Group.
New Exit Policy
Under New Exit policy, the realty developers are allowed to surrender land parcels lying vacant to local development authorities, they will be able to use the refunded money in a more productive manner to complete the sick projects. Even they can utilise the cash on their market planning to sell inventory.
Now with the enforcement of exit policy, builder can complete the project which is nearing completion and can give possession of flats on time.
Digital medium brings new hope in the realty industry
Experts say that Digital India initiative by the government has helped to bridge the gap between buyers, builders and local development authorities. At the moment Delhi, Mumbai, Bengaluru and the NCR regions such Noida and Gurgaon use online digital space for building plan approval. In Mumbai BMC has brought the entire building proposal system online. The Bruhat Bangalore Mahanagara Palike (BBMP) has also introduced the online building plan approval system. The Haryana Development Authority (HUDA) has decided to go online this year only to ease the process of building plan approval. The Municipal Corporation of Delhi (MCD) has also taken initiative to create online single window system for the building clearance.