Real Estate (Regulation and Development) Act, 2016 is undoubtedly a path-breaking law that has revived buyers’ confidence and made regulations for developers to register their project agreed the panellists in a discussion around one year of RERA organised by Magicbricks in Delhi. However, the panellists accepted that the Act undoubtedly benefits all stakeholders, the first year showed that there are still teething issues to be sorted out, they said.
Mudassir Zaidi, ED North remarked, “One year later, 14 states still haven’t implemented RERA and consumers still have basic knowledge about it. Maharashtra RERA is doing good job. RERA authorities are taking action against faulty practices.”
Highlighting the observations on the market post RERA, he said, “There is pent up demand in the market. Transactions are not that high, though, as queries are. As compared to other areas, affordable segments of Delhi NCR are getting better demand. The ready-to-move-in houses are preferred due to GST and low risk factor,” he said.
What kind of properties are preferred in the market by home buyers – ready-to-move-in properties or under-construction ones? Ashwani Prakash, ED, Paramount Group said, “Ready-to-move-in properties are most sought after as people do not want any more delays.”
Bringing a fresh take at the scenario, Sumes Dewan, managing partner, Lex Favios law firm said that home buyers who bought a house in 2017, still have their unresolved. “There are a large segment of home buyers who cannot take up their issues with RERA,” he said.
What is the profile of home buyers who are active in the property market these days? Mahesh Goel, MD, Investor Planner said, “Working people are end users in the market for houses in the range of Rs 35-40 lakh. But they are not getting the right stock as per their requirement and therefore they are taking a long time in researching and looking.”
However, Zaidi pointed out that there are enough unsold units for the buyers in the market. “About 62000 units in the NCR market are launched and unsold in the likely range of Rs 30-70 lakh. Noida and Greater Noida section have more number of unsold units,” he said.
It seems that the demand in Noida and Greater area is set to grow. Amit Goel from WTC said, “As Greater Noida is going to be a mobile hub, there will be demand for housing, especially for people working at the monthly salary of Rs 15000.”
“Economic activities in some sectors of Noida and Greater Noida are increasing and thus these are the areas where rental yield is improving,” he added.
Regulations make market transparent
RERA has definitely changed the property market and the change is going to be more visible in the future. Zaidi said, “Shift in how consumers and builders work in the market has come up. The NCR property market has shrunk to the actual need, which is around 40000 units. New launches are not happening because we are reaching the stage where developers may collaborate with each other, making strong groups that can withstand the market.”
“With more regulations in the industry, the future is better. But the pain of what has happened in the past will take some time to go. RERA may take 3-4 years to settle things in the market,” he added.
Welcoming the RERA regulations, Ashwani Prakash said, “RERA rules clarify penalties and this may make the property market transparent and bring back the lost confidence of buyers in the market.”
There were some observations in the market from the audience as well. Anil Mittal, broker from Faridabad said, “There is no spectacular amount money to be made in the real estate market now, as it was made earlier. Profit margins have come down in the case of new launches.”