MahaRERA Maintaining Transparency In Real Estate Sector
Herein produced is the excerpt from the Interview given by the Top Guns, the dynamic duos of theMahaRERA :
In the words of Dr Vijay Satbir Singh , Member, Maharashtra Real Estate Regulatory Authority (MahaRERA) ,“ Maharashtra has been at the forefront to establish the institution framework in the form of Maharashtra Real Estate Regulatory Authority (MahaRERA), well ahead of other States in the country and an online registration of projects and complaints were made available to the promoters and home buyers.”
Views On The Concept Of RERA And How Helpful It Has Been In Regulating And Streamlining Real Estate Sectors Within The State .
Before RERA Act, 2016, the real estate sector in India has largely remained unregulated. It has introduced transparency, accountability and financial discipline in the working of this sector.Simultaneously, it ensures timely completion of various projects by the promoters, by putting financial control on them. The promoters have to open separate designated accounts for the project in which they have to deposit 70 percent of the amount received from the allottees, which controls the promoters from releasing payment to any other project or purpose, which ultimately helps in completion of the project on time.
On The Performance Of MahaRERA As Compared To Regulatory Authorities In Other States.
MahaRERA has been able to perform better than any other States in the country. Maharashtra has been in the forefront to establish the institution framework in the form of Maharashtra Real Estate Regulatory Authority (MahaRERA), well ahead of other States in the country and an online registration of projects and complaints were made available to the promoters and home buyers. All these resulted in the registration of around 17,904 real estate projects and 16,587 real estate agents, which is nearly half of the registration in the country. Undoubtedly Maharashtra has been a front runner in the country in this regard.
Organising A Workshop InPune.
Like Mumbai, the Pune Region is also having a large number of projects registered with MahaRERA. Besides, it has a state level institution known as “Yashwantrao Chavan Academy of Development Administration (YASHADA) ” which is a training institute for making it convenient for the Government of India to organise workshops at Pune.
The idea behind organising the workshop was to create a knowledge sharing platform where other states namely Goa, Gujarat, Uttar Pradesh, Telangana, Chhattisgarh and Karnataka could gain some knowledge of the implementation of MahaRERA in the state.
About The Real Estate Appellate Tribunal.
Under section 43 of the RERA Act, the State Government has constituted Maharashtra Real Estate Appellate Tribunal headed by retired Judge of Hon’ble High Court. Besides an adhoc arrangement has been made assigning the said work to Maharashtra Revenue Tribunal, till the time the regular body starts its work.
About The Herculean Task Of RegulatingReal Estate Agents And Real Estate Web Portals.
The MahaRERA has also registered around 16,587 real estate agents by giving them proper MahaRERA registration numbers. The real estate agents cannot function and initiate sale in the MahaRERA registered projects without getting registration certificate from MahaRERA. They can be penalised if they violate any relevant provisions of the RERA Act.
Challenges Faced By The MahaRERA.
The completion of incomplete projects, quality controls, title Insurance, and compliance of various provisions of the RERA Act by the promoter are some of the important challenges before the Authority.
In the words of Gautam Chatterjee , Chairman, Maharashtra Real Estate Regulatory Authority (MahaRERA), “ The Maharashtra Real Estate Regulatory Authority (MahaRERA) was constituted by the State Government for the development and regulation of the real estate sector and to safeguard the interest of the buyers. It is a matter of pride that MahaRERA , since its inception, has been delivering on the expectations of its stakeholders.”
On the Disputes Resolving Machinery set up by MahaRERA
The Real Estate (Regulation and Development) Act, 2016 was enacted with some major objectives. The Parliament came up with this Act so that the interest of buyers can be protected. To understand the real objective of the Act, first we need to understand the challenges. Real estate is the second most important sector after agriculture which is generating employment and contributing majorly to the country’s GDP. However, the sector remained unregulated. When there are no regulations, problems like forgery and cheating, late delivery of homes, information asymmetry etc, arise. The Act is trying to achieve three main objectives:
Bringing in complete transparency in the system: Now every project that gets started in Maharashtra has to be registered with MahaRERA and the promoter of the project has to make disclosure about all the mandatory clauses, or clauses that he may further want to add. All this information is available in the public domain.
Ensuring completing uncompleted projects: All the builders working on real estate projects which do not have the occupancy or completion certificate from the Competent Authority have to register themselves with RERA. The prime objective in registering a project is to ensure the same gets completed and buyers get their homes.
Building trust between the builder and customers: There is a huge trust deficit between the builders and customers. We need to bridge that gap through discipline, accountability and conciliation forum.
For this, we have created a conciliation forum where both the parties involved sit across the table and resolve their differences. Representatives of Promoter’s body and Consumer’s body act as facilitators and we have created 15 benches for that purpose in Mumbai and Pune. The success rate in this process is close to 90 percent and that is so heartening. The idea is that the matter should not linger on in the court but get resolved by reaching a mutual understanding.
We have put all the MahaRERA registered projects on Google Map so that a person looking out for a home can look at all the options before making an informed choice. The credentials of the builder can also be seen in the public domain. Information like how many flats sold, the amenities that the builder is providing in a project are available for all to see. These things help a consumer to decide on a project he is interested in. Before this Act, people were dependent on word-of- mouth publicity. Now everything is available online. This transparency is a game changer.
MahaRERA has tried to implement the Act in its letter and spirit and taken it forward for the well being of the customers.We have received over 4,200 complaints, out of which over 2,600 complaints have been disposed of and orders issued, which are out in the public domain on our website. Even our replies to RTIs have been posted on our website and are available in the public domain.
The Secret behind the super colossal success achieved by MahaRERA.
We have complete clarity in our approach. A dedicated team of 35 people are managing more than 40,000 cases of project’s registration, agent’s registration and complaints, all put together. We have been able to do it with the robust use of our digital platform and our team of MahaOnline, our IT partner and KPMG, our knowledge partner. We firmly believe in promptness of service.
About the Digital forces working in collaboration with MahaRERA-Building Strong Partnerships .
First, we had to finalise the draft rules announced by the Government by hearing the objections and suggestions to the draft rules. After going through the process, I gave my recommendations to the Government. When I was appointed interim regulator, we had only four months before the actual implementation of this Act began. The Hon’ble CM had made it amply clear that MahaRERA should operate on a digital platform right from day one. We worked with MahaOnline which is a Government of Maharashtra and TCS Joint Venture organization. It was found to be the most suited organisation to put our whole digital strategy in place. KPMG, which was working with the Housing Department, became our knowledge partner. On the midnight of 30th April, 2017 we were able to roll out our digital initiatives.
The Backing of the State Government.
They not only gave us a free hand in setting up and operationalizing MahaRERA but supported us at every step. I handpicked my team which is fully dedicated. Some of them have worked with me earlier too. The support of Hon’ble Chief Minister of Maharashtra and Hon’ble Minister of Housing has been tremendous.
Public Awareness Campaigns.
Creating awareness among the stakeholders is one of our key focus areas. Today, the total number of projects and agents registrations has reached 32,000. We helped in making the promoters realise that registration is necessary, as we would give all the information to general public which is their objective too. We held a lot of meetings with all stakeholders and attended many seminars pan- Maharashtra. All the information is available on the website and there is a helpdesk as well. We have set up offices in Nagpur and Pune also.
Response from the Real Estate Fraternity .
The response has been very good, I must say. We do keep getting constructive suggestions, which we try to act on. Criticism, if any, is taken in good spirit and efforts are made to improve in the areas pointed out.
What began as a mission to empower home buyers, now has a concrete existence in the form of RERA.
Government of India has enacted the Real Estate (Regulation and Development) Act 2016 and all the sections of the Act shall came into force with effect from May 1, 2017, thereby laying the foundation to address the grievances of the aggrieved home buyers. For years, the complaints would lie in either the Consumer courts or in Civil Courts. The long drawn litigations relating to the disputes between the Home Buyers and the builders often caused distress to both the parties. Thus, the birth of RERA is the hope for speeding up the litigations as also to keep a leash on the fraudulent and defaulting builders. RERA is a game changer like many other economic reforms that have taken place since the inception of the Modi Government.
RERA takes into its purview the Promoters as well as the Real Estate Agents.
KNOWLEDGE CAPSULE- MahaRERA’s 1st Anniversary Special
RERA… The Impact on the Industry
On the first anniversary of the Real Estate (Regulation and Development) Act, 2016, here is a review of its implementation by industry experts. The collective sentiment reflects that RERA has identified challenges in its execution, and has a long way to go in making the real estate sector more efficient and transparent.
Jaxay Shah, President, CREDAI National: The implementation of RERA has been nothing short of a game changer for the real estate sector. However, there is a clear disparity between States with regards to the implementation, with regions such as Maharashtra setting the benchmark in the industry. The lack of infrastructure and non-notification of RERA rules by some States have led to delays and loss of revenue to different stakeholders. The RERA tribunals have also not been set up by most States. CREDAI has been urging the government to set up RERA in each State to address home buyer grievances. This will further decrease participation of the higher courts and provide quick and low-cost solution to most cases. CREDAI believes that the lead from Maharashtra has to be followed by forming a RERA conciliation panel wherein CREDAI will partner and offer its support.
Shishir Baijal, CMD, Knight Frank India: The RERA is a path-breaking law, with immense potential to revive buyers’ confidence and drive momentum in the residential real estate market. States such as Maharashtra, which implemented the regulation in true letter and spirit, witnessed signs of up-tick in residential sales and overall consumer sentiments. While it has been observed that just over one out of 10 State governments showed the political will and gravity in executing the Act, we believe that other States would soon follow suit.
TushadDubash, Director, Duville Estates: Implementation of policies like RERA and GST last year had a significant effect on real estate, and it brought about a substantial shift in the market. Consumer sentiment is finding its way back as is being reflected in sales offtake levels of established developers. Simply put, the Act ensures transparency and efficiency in the market and safeguards the rights of home buyers.
Kamal Singal, CEO & MD, Arvind SmartSpaces: RERA was aimed at improving transparency and it has been successful in enhancing the overall sentiment towards real estate. The entire process, right from buying of land, funding of projects to delivery of the final product to the buyer has witnessed a positive change, which has proven to be beneficial to both customers and developers. The efficient and transparent property market has made India far more attractive to both global and Indian investors and will increase demand for organised real estate.
Niranjan Hiranandani, President, NAREDCO: Under RERA the Indian real estate sector has its first regulator. RERA has made it obligatory for States and Union Territories to structure their own regulator and outline the rules that will administer the operation of the regulator within their jurisdiction. RERA is a big step forward, but it will take some more time for all the States to comply with the norms for bringing in the much-required protection and transparency. We have to see how things will pan out before we start assessing the RERA performance.
Ram Walase, MD & CEO, VBHC: Despite the initial turbulence, RERA could transform the industry for the better. It could become more organised like the auto industry – driven by clearer product definitions, standardised technologies, well-defined branding & positioning and intensive customer service orientation. Other value chain elements such as land acquisition and project approvals, which were the mainstay in the past, could become ancillary inputs. Some of the immediate challenges that need to be addressed are: (a) While developers are penalised under RERA for not delivering, the approving authorities have no direct accountability. Integrating this aspect with the RERA could be an important reform; (b) The institution should discourage / penalise frivolous complaints against developers so that the RERA is not misused.
Surendra Hiranandani, CMD, House of Hiranandani: The realty market is experiencing consolidation as unorganised players are struggling to cope with stringent compliance norms under RERA. It is now clear that only credible developers will survive in the future. This is good from a buyer’s perspective as one is assured of a quality product within stipulated timelines. With RERA in place, home buyers can also hope for a risk-averse journey. Under RERA, the developer has to provide a written affidavit to the buyer stating that the legal title to the land on which the construction is planned contains legitimate documents of ownership. Title insurance is a form of indemnity insurance which insures against financial loss from claims in title to real property. While other forms of insurance provide protection against future loss, this provides cover for an event in the past which has resulted in disputes.