Real Estate Act yet to show teeth
Only 20,000 projects registered; only six States have permanent authorities
Only 20,000 housing projects have been registered under the Real Estate (Regulation and Development) Act, 2016, six months after the legislation seeking to protect the interests of homebuyers came into force last May. This is just a fraction of the under-construction and proposed housing projects promoted by private developers.
Six months on, The Act was initiated by the previous United Progressive Alliance government and passed by Parliament in 2016 and notified in May 2017. The developer has to declare to buyers detailed information such as dates on which various government clearances are secured, floor plans, carpet area, progress in construction, and so on.
All real estate projects have to be registered with the Real Estate Regulatory Authority (RERA). However, the Housing and Urban Affairs Ministry says only six States have set up permanent authorities, while 23 have set up an interim one.
The low registration of projects can be explained by the fact that many States have rules that favor private developers.
For example, Gujarat, Haryana and Uttar Pradesh have exempted ongoing projects from RERA. Similarly, in Karnataka, projects that are 60% complete have been kept out of RERA. In Maharashtra, the rules say that if any building in a project is completed, then it need not be registered.
“The real estate market is in a slump. The low registration of the projects can be partially explained by the twin factors,” an official said.