RERA goes live but dilution by states remains the concern: Angel Broking

Views of Mr. Abhishek Lodhiya (Sr. Equity Research Analyst - Infrastructure, Capital goods and Real Estate, Angel Broking):

"The Real Estate Regulation Act (RERA) goes live across nearly 13 states effective May 1st 2017. While the Parliament passed the Model RERA Act, the actual passage of the state level act was left to the respective states. Real estate being a state subject, the centre can only define a model code and the actual implementation is left to the wisdom of the states. Apparently what has happened in this case is that states have diluted these provisions in favour of builders. For example certain states have kept existing and ongoing projects outside the ambit of RERA, largely diluting its impact.

Out of the 13 states and UTs that have so far notified the RERA rules, there has been some element of dilution in most of the states. For example Gujarat has exempted all projects launched before November 2016 from the ambit of RERA. Under RERA, projects that have not received completion certificates need to reapply under RERA. UP has exempted such real estate projects. Maharashtra has also given the RERA Authority the powers to withhold any document from public viewing, something not provided for in the RERA Act. In a nutshell, with the diluted version and limited implementation, it is uncertain how impactful the RERA will be and will it solve the whole purpose of safeguarding home buyers on an all-India basis."

Source : Equity Bulls

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