In May, the Supreme Court had said that WBHIRA creates a parallel regime and is in direct conflict with the Centre’s Real Estate (Regulation and Development) Act (RERA). The state law has encroached upon the domain of the Parliament and hence is unconstitutional, the verdict said. (Representative image)
As many as 76 percent of consumers are aware of RERA and plan to buy only RERA registered properties and five out of six homebuyers seek redressal through RERA, a survey that assesses RERA performance in five Indian states across key dimensions has said.
According to stakeholder perspectives from Maharashtra, Uttar Pradesh, Madhya Pradesh, Orissa, and Karnataka, RERA has been effective in increasing consumer confidence and greater accountability.
The survey said that while overall consumer awareness is high, the specific provisions of the law are still not well understood. It also shows that the implementation of the grievance redressal process still has many gaps.
A survey by Omidyar Network India and Boston Consulting Group titled 'Five Years On: An assessment of RERA - The Road Ahead For a Stronger On-ground Regime' gauges its impact on the crucial real estate sector since its enactment five years ago.
It points out that the implementation of the grievance redressal process still has many gaps as "only 22 per cent of the consumers involved in a grievance redressal process were satisfied due to the uncertain timelines involved".
The survey points out that as many as 77 percent of all eligible projects have been registered under RERA.
It said that there is a lot of work to be done to streamline the understanding of the provisions of RERA, increase stakeholder confidence through even greater transparency and improve the grievance redressal process as 30 percent of consumers surveyed were still unaware of RERA’s role as a regulator.
One in two (50 percent) consumers reported being aware of just two benefits of the Act - the mandatory registration of the relevant projects and RERA as a grievance redressal forum, it said.
Only 14 percent of all potential homebuyers have visited their relevant RERA site, and 24 percent of these consumers said that they were satisfied with the online experience.
Among developers, 64 percent of those surveyed were highly satisfied with the RERA authority. As many as 55 percent of developers surveyed were also able to secure loans more easily due to RERA but 45 percent of all developers surveyed reported dissatisfaction with the RERA website, it said.
With RERA now having been implemented in 26 states and UTs, this data also urges state RERAs and other policy stakeholders to build on consumer education and awareness, streamline processes and drive adherence across states; evaluate and steer policy-level shifts and thereby, facilitate growth and promotion of the sector.
Based on in-depth interactions with over 1300 customers, developers and regulatory authorities, the report highlights the impact of the legislation on each of these stakeholders.
The report assesses RERA performance in five Indian states across key dimensions — customer awareness and education, transparency, accountability, timely grievance redressal, and overall confidence in the real estate sector. It examines whether the law has been able to address challenges of lack of transparency and efficiency at a micro (householder) and macro (real estate sector) level.
The report was released on July 28 by Surendra Bagde, Additional Secretary (Housing), MoHUA, Government of India, Shilpa Kumar, Partner, Omidyar Network India and Neetu Vasanta, Managing Director and Partner, Boston Consulting Group and will be distributed to the Prime Minister’s Office, Niti Aayog, Chief Ministers, State ministries, RERA authorities and Secretaries amongst other dignitaries in the public and private sector.
“An average Indian household maintains 75 percent of all its assets in real estate. Combine this with the fact that 66 percent of civil cases in India are on land and property disputes, and it is obvious that RERA has a critical role to play. Our report shows that in the last five years, RERA has begun moving in the right direction, increasing consumer confidence in the real estate sector,” said Shilpa Kumar, Partner, Omidyar Network India.
The report also points to the need for more focus on greater consumer awareness, better RERA websites and focussed grievance redressal to further improve consumer confidence in the sector. This can drive better household balance sheets as well as India’s growth trajectory. Further, the report shows the direct impact good legislation can have on its constituents, Kumar said.
“It is great to see the boost in consumer confidence that has been created by RERA over the last 5 years in the Real Estate Sector. However, there is still headroom to improve customer experience and unlock efficiencies in the sector by bringing in increased transparency and systemic accountability. A well-executed RERA can further improve private investments by 5-7 percent and potentially create 4-6 million additional jobs in the sector and related industries,” Neetu Vasanta, Managing Director and Partner, Boston Consulting Group.
Speaking at the report launch event, Surendra Bagde, Additional Secretary (Housing) MoHUA, said “The real estate sector’s contribution the country’s GDP is significant and our vision is to grant further impetus to the industry and make it a 1 trillion USD sector by 2030. The real-estate industry shows immense potential to grow once regulated by norms that instill confidence in homebuyers and developers alike,” he said.