RERA – An Imperative to structure the Secondary Real Estate In A Transparent Way
When RERA (Real Estate Regulatory Authority) was implemented in 2016 there were many apprehensions in the industry of its adoption and effectiveness into the Primary Real Estate market. RERA made its initial impact when the market faced a shrunk and transactions remained flat, RERA played its vital role in bringing back the consumer confidence in major aspects where we can see the market bouncing back into effective manner. While RERA ensures the consumer in protecting their interests and gains consumer confidence it is no way surprising there are of 20,000 developers in the market comparatively having 45,000 developers earlier. It does not bring professionalism alone but boosts consumer to start dealing with organized entities to have a longer stake in the business.
Though, having RERA brought much more of confidence of buying Primary Real Estate but at recent, consumers started to show more interest in buying from the Secondary market where buying a resale property will be immediate and does not delay while purchasing, unlike Primary Property. Though, a recent report says that the 47 percent of the respondents want the Government to slick the Secondary Real Estate transparent.
Challenges faced in Secondary Market
While buying a Secondary Property background legal check is a must and it is where they are more prone to losing their money to the seller, the majority of the buyers feel that the escrow mechanism needs to be intervened to avoid loss. It is being hard to find the right property for the right price. There is a need to rationalize the stamp duty and agreements. A report says that the government has to implement escrow system by digitizing property across the country to give transparent and reduced forge Secondary Market.
After REAR the confidence in builders are improving and property seekers are returning back to the Primary Market after a long stay being away, India’s Real Estate industry is witnessing balance and have taken a turnaround after the mute in 2017 such as Secondary Market needs a formalization which will bring transparency and pull in Authority for Real Estate dealing while reducing much of the forge.
Revamp to be made for Transparency
Federation of Indian Chambers of Commerce and Industry, Grant Thornton India and escrow platform Escrowffrr, has recently come up with a report stating new ideas for improving transparency in Resale Property. While the report’s recommendations are the following:
- Rationalising the Tax Structure by including stamp duty as part of the GST where the stamp duty is increased comparatively after GST. So, the request is made for making Stamp duty included in the GST.
- Escrow Mechanism to be made mandatory while it will protect all the parties that in being involved in the sales. This will increase the transparency within the parties and as well reduce litigations.
- It is suggested that the government should look in bringing Real Estate agents a single license fee structure across the country which will be an improvising measure to meet the Global Standards.
- The Government must focus on mandatory Digitization of Property Records from registration and previously registered records, as they will be easier in accounting them as well in reducing any legal challenges faced by either of the parties involved.
- Transactions happening through banking channels will improve the ease and regulations in the Industry.
The stringent provisions of RERA has made a great impact in the Real Estate market of India where it is gradually finding a way to tranquility after the fall, though it is recommended for the Government in bringing the transparency in the Secondary market where the stock exchange will lead to having a balance in another few years due to regulations in both of the Real Estate Market. It is suggested to look at the Growing interest of Buyers in Secondary Market and bring more of essential Transparency to it promptly.