ANSWER: Real Estate (Regulation and Development) Act
Explanation:
Real Estate (Regulation and Development) Act (RERA) is expected to usher in an urban real estate revolution in India.
Flat property prices over the past two years have made the real estate sector a no-go zone for investors.
But RERA, along with demonetisation and goods and service tax (GST), will make sure that the market is largely driven by end users.
While RERA benefits the builders by bringing in more transparency and accountability, which will stand them in good stead by ensuring the flow of institutional funds, the real winner will be the end-user–the home buyers.
The immediate impact would be likely on consolidation, how capital is raised and deployed, and increasing compliance costs for developer. It will also impact transparency, demand uplift and consolidation.
However rules put forward by states have diluted many provisions, keeping most of ongoing projects outside the ambit of the law that would come into effect from May 1.
States such as Odisha and Bihar have notified rules that are completely in sync with the one notified by the Union housing and poverty alleviation ministry.
In contrast, Haryana's draft rules, notified last week, have completely left out disclosures by builders on the sanctioned plan, layout and specifications at the time of booking with all subsequent changes till date.
This omission will give legal colour to all unilateral changes done by builders and will give them an escape route to avoid paying compensation to home buyers.
In Maharashtra, a provision has been included to allow builders to take out or divest from a project after occupancy certificate has been issued.
This means, the builder can pull out its entire investment before completion of common areas, facilities and amenities.
In UP, the norms related to compounding of offences have been diluted as no specific amount has been mentioned. There is provision for 'up to' (a certain amount), which means it may even be zero.
This will encourage corruption as quantum of money to be paid will be at the discretion of the authority.
The urban development ministry has allowed relaxation even in Delhi, where rules specify that promoters need to provide details of only those court cases which have been disposed of during the last five years.
This is despite the housing ministry clearly stating that builders need to provide details of all pending cases.
