The real estate sector accounts for nearly 6 per cent of India’s GDP as millions of ordinary middle class home buyers book flats in group housing projects across the country. But these buyers face a double whammy every time they book a flat. They end up paying both EMI and rent for long periods of time as they face endless delays in getting possession of their flats and villas from the builders.
Delayed possession is the biggest problem faced by home buyers. As per a survey done by a real estate research firm, only 22 % of 7,30,000 housing units committed for delivery in 2015, have actually been delivered.
About 25% of around 2 lakh units in the NCR region committed for delivery in 2015 have actually been completed. The scenario is worse in Mumbai, Navi Mumbai and Thane where the completion level is just about 20%.
Developers blame it on inexperienced players and the requirement to comply with a plethora of rules and regulations. According to Getamber Anand, President of Credai National, local bodies withhold clearances and completion certificates only for extraneous reasons.
In order to provide a dispute resolution mechanism and end the uncertainty in the market, the union government introduced the Real Estate (Development and Regulation) Bill in the Rajya Sabha in 2013. This year the NDA government sent the bill to a Select Committee of the Upper House, headed by BJP member Anil Madhav Dave. This Committee submitted its report in the Monsoon Session of the Parliament that ended last month in August 2015.
In its report, the committee has recommended that all housing projects that measure 500 square meters or more, have to get mandatory registration with the proposed real estate regulator. It also recommended that all sanctions, approvals and construction plans by the developers need to be disclosed. The report also calls for imprisonment in case of violations. A developer can face up to 3 years of imprisonment and an agent can get a year in jail for violating the provisions of the Bill.
In a landmark decision, the committee recommended that all ongoing projects that did not receive a completion certificate on the date of notification of the proposed law, will be brought under the Bill.
Meanwhile, harassed home buyers have been gathering at Jantar Mantar in New Delhi for years to press for their demand for the passage of the Real Estate Bill. The protesters have now threatened to gherao the Parliament if the Bill is not passed.