New Delhi: RICS recently submitted its recommendations on the ‘Model Real Estate (Regulation of Development) Act’ to the Ministry of Housing and Urban Poverty Alleviation (HUPA).
The response was based on the collective views and suggestions of the RICS working committee on real estate and housing, which constitutes of the top management of real estate development firms, private equity firms and international property consulting firms.
All committee members agree that there should be some form of regulation for developers as well as individual brokers and a majority feels that developers should be required to obtain a registration certificate for every project, from the regulatory authority.
The suggestion of an online portal where developers would be mandated to update important project details has been welcomed, as it would automatically help India build a database which is most required in the not so transparent real estate sector.
Views on requirement of 5% bank guarantee are however divided, as most members feel that it could be another contributing factor to increasing cost and time of the project.
An extensive study of the legislative frameworks of a number of regulatory bodies such as SEBI, IRDA, TRAI, Council of Architecture as well as International real estate regulatory bodies, was undertaken to ascertain the structure most suitable for Indian Real Estate.
Based on the study, RICS believes that the best approach for regulation is for the ‘Act’ to establish the regulatory authority with an aim to regulate and promote orderly growth of the real estate sector. The Act should set out the broad principles of regulation with rules and regulations being more specific. This would give the regulator statutory authority while allowing the authority or expert groups to set up rules and regulations for specific areas such as regulations for developers, procedures for registration and to update project details online, dispute resolution mechanism and procedures, etc.
Source: http://www.indiaprwire.com
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