ref:
http://www.rics.org/press
New Delhi, Delhi, November 17, 2009 -- RICS recently submitted its
recommendations on the 'Model Real Estate (Regulation of Development)
Act' to the Ministry of Housing and Urban Poverty Alleviation (HUPA).
The response was based on the collective views and suggestions of the
RICS working committee on real estate and housing, which constitutes
of the top management of real estate development firms, private equity
firms and international property consulting firms.
All committee members agree that there should be some form of
regulation for developers as well as individual brokers and a majority
feels that developers should be required to obtain a registration
certificate for every project, from the regulatory authority.
The suggestion of an online portal where developers would be mandated
to update important project details has been welcomed, as it would
automatically help India build a database which is most required in
the not so transparent real estate sector.
Views on requirement of 5% bank guarantee are however divided, as most
members feel that it could be another contributing factor to
increasing cost and time of the project.
An extensive study of the legislative frameworks of a number of
regulatory bodies such as SEBI, IRDA, TRAI, Council of Architecture as
well as International real estate regulatory bodies, was undertaken to
ascertain the structure most suitable for Indian Real Estate.
Based on the study, RICS believes that the best approach for
regulation is for the 'Act' to establish the regulatory authority with
an aim to regulate and promote orderly growth of the real estate
sector. The Act should set out the broad principles of regulation with
rules and regulations being more specific. This would give the
regulator statutory authority while allowing the authority or expert
groups to set up rules and regulations for specific areas such as
regulations for developers, procedures for registration and to update
project details online, dispute resolution mechanism and procedures,
etc.