Rera has made progress in four-five states, but has failed to address homebuyers’ concerns in others
While many states don’t have a website yet, some of the existing websites are of little help to home buyers
Santosh Parashar, 40, chief programme executive at a government think tank, has filed a case against a Ghaziabad-based real estate developer with the Uttar Pradesh Real Estate Regulatory Authority (Rera). Parashar, who is set to appear for his first hearing on 9 May at the Gautam Budh Nagar (Greater Noida) bench of UP Rera, is hopeful that the authority will come to his rescue. Since UP Rera came into existence, it has seen about 12,500 cases, out of which 5,700 have been disposed of till date.
Parashar booked an apartment at a housing project in Ghaziabad in March 2015. However, while signing the builder-buyer agreement in September 2015, he realized that the house number mentioned in it was different from the one in the initial booking document. By then, he had already paid the booking amount and a few initial instalments. Parashar refused to sign the agreement and asked for a re-allotment. After several rounds of requests and arguments, he was finally allotted another unit, and signed the agreement in December 2015. But this was not the end of his ordeal. Some months later, Parashar found out to his utter shock that the unit alloted to him didn’t exist in the building plan. A few other homebuyers also faced the same issue, but repeated enquiries failed to elicit any response from the developer. Moreover, the project is delayed. “Buyers were supposed to get possession in December 2018, but construction came to a halt one and a half years ago and only 30% of the work has been done till date," said Parashar, who finally lodged a formal complaint with Rera in April 2019.
Parashar and many other buyers stuck in similar situations have pinned their hopes on the real estate regulator set up under the Real Estate (Regulation and Development) Act, 2016, enacted three years ago. The Act mandated a separate Rera for each state. While it has made progress in four-five states, it is still to take off fully in most other states and Union territories. Read on to find out how far the needle has moved.
Still not on track
The Act was enacted on 1 May 2016, and all states were mandated to formulate and notify rules for the functioning of the regulator in their respective jurisdictions within six months, and set up a regulator by 1 May 2017. However, many states failed to meet both these deadlines.
Every state was also supposed to launch a website within a year of Rera’s establishment. However, according to information compiled by Anarock Property Consultants Pvt. Ltd, a real estate consultancy, states like Manipur, Meghalaya, Mizoram, Sikkim and Nagaland are yet to notify rules under the Act. Also, Arunachal Pradesh, Assam, Tripura, Lakshadweep and Puducherry are yet to launch their websites (see graphic). A few others states have diluted some of the provisions of the Act, while the West Bengal government has drafted its own separate real estate Act and established a Housing Industry Regulatory Authority under it.
Launching a website was an important aspect of the Act to provide homebuyers information such as names of under-construction projects and details like the names of developers and promoters, approvals, the number of apartments, possession date, registered agents, and so on. The Act mandates that the website must enable homebuyers to file complaints online. While many states don’t have a website yet, some of the existing websites do not have adequate information and are of little help to the homebuyers.
“Orissa Rera does not even have a working phone number to guide," said Sarada Prasanna Das, a homebuyer from Jagatsinghpur, Odisha, who works in a non-government organization. Das booked an apartment in late 2011, which was to be delivered in 2013. The 39-year-old finally had to cancel his booking in 2015 as the construction of the tower in which he booked had not even started. After a lot of following up, the developer returned ₹40,000 out of about ₹5 lakh Das had paid, and provided a repayment plan to settle the remaining amount by July 2016. Das, who hasn’t received even a single repayment instalment until now after the initial payment, is now trying to get Rera’s help to recover his dues. But so far he has been unable to file a formal complaint with Rera because he doesn’t know how to go about it and the information on the website is not helpful enough.
Das is not the only one who is disappointed with the way Rera functions. Manish Patni, 52, a Gurugram-based homebuyer, is fighting a case against a Haryana-based developer in the National Consumer Disputes Redressal Commission (NCDRC) seeking a refund of his payments to the developer with interest, as the project is delayed. He claims that the developer had promised a different layout in the builder-buyer agreement and the brochure at the time of booking but submitted a revised brochure for the project, with a different project layout, when getting the project registered with Rera. “When I along with other aggrieved homebuyers wrote an email to Rera and Town and Country Planning Department, Haryana, providing them information about the wrongdoings of the developer, none of them acted on it. When we approached the Rera office, they said they would act if we withdraw the case from NCDRC and file a fresh formal complaint with Rera."
Patni alleged that Rera had not taken any action even though they had provided it the relevant information and documents.
Mint has reviewed the documents substantiating the claims of aggrieved homebuyers mentioned in the story.
While a few states claim to have solved a large number of complaints filed with them, their websites still lack some important information. For instance, information about cases against developers or projects are not available on the UP Rera website. However, in a recent interview, Rajive Kumar, chairman, Uttar Pradesh Rera, said that they are working on it and such information will be made available soon.
What has improved
While there are various issues that Rera faces, it is doing well on some fronts. A real estate expert based in Gurugram, Pradeep Mishra, said Rera is doing relatively well if we consider projects that were launched after Rera came into existence. “The authority is checking papers before registering projects; it is also doing a ground check, taking stock of development and so on. However, it’s a toothless tiger when it comes to old projects," said Mishra.
Besides, after Rera came into existence, the speed of construction has also improved. According to data from Liases Foras, a Mumbai-based real estate rating and research firm, data for 41 cities shows that the average time taken to complete construction work up to the first floor after the launch of a project has come down to six months after Rera was enforced from 21 months.
Given the high level of project delays and cheating cases, Rera’s enactment after eight long years of wait (its first concept paper came in 2008) had raised hopes among homebuyers. But lack of seriousness and slow pace of its implementation by several states has come as a setback.