Do You Have RERA Compliance Queries?

Complying with RERA provisions requires greater level of transparency, objectivity and professionalism, as it has enhanced the accountability and liability of real estate developers, property consultants etc. Therefore it is essential for real estate organizations to put in place a structured RERA compliance management process Developers need to streamline their processes, form teams and train employees on the new regulatory provisions. . However there are lots of confusion regarding RERA compliance by real estate organizations. On the other hand, NIREM with the mission to empower the Indian Real Estate sector is working to make the regulation as simple as possible.

If you are a real estate promoter or a professional into or planning to join the RERA compliance team and have any query regarding the RERA compliance, please send us your queries to info@nirem.org. Our Regulatory Compliance Expert Mr. Sumit Jha would respond to your queries. Please mail specific and relevant queries by 30^th April, 2017.

Developers scramble for Real Estate Act compliance: Hindustan Times

The year 2017 will be significant for homebuyers harassed for years because of property sale agreements lopsided in favour of developers, violation of building rules and delayed home delivery. The consumer-friendly Real Estate Regulatory Act (RERA), which kicks in from May 1, has pushed developers to sign agreements with buyers and take other initiatives which they claim are RERA compliant.

Mr. Sumit Jha, CEO, NIREM says that developers are putting up special RERA compliance teams to monitor projects and ensuring timely completion of projects, training sales professionals on customer interface post RERA and upgrading their agreement to sell. Read more at http://www.hindustantimes.com/real-estate/developers-scramble-for-real-estate-act-compliance-but-buyers-remain-sceptical/story-ixAlP94x4d8ZnFiHJJ2bpL.html

Housing.com to set up online platform for realtors body CREDAI

Housing.com today signed an MoU with the Confederation of Real Estate Developers' Associations of India (CREDAI) to set up an online platform to help developers engage with customers in a hassle free and effective manner. The MoU will be effective for a period of three years.

"The objective of the MoU will be to improve the overall ecosystem and create a new age platform that will enable the developers to engage with the consumers in a focused manner," Housing.com said in a statement.

CREDAI is the national body of real estate developers associations from across the country. With 11500 members in 154 city chapters spread across 24 states. On the other hand Housing.com is the leading online real estate platform.

Housing.com’s Chief Business Officer Jason Kothari said, "The partnership is a testimony of changing times in the manner developers have been traditionally operating in the real estate space". He further said that the the association would redefine the way developers have been approaching the buyers across India; adding that the alliance would make the real estate community more transparent and consumer centric.

CREDAI National President Getamber Anand said the synergy with Housing.com would help in bringing an additional credibility to the real estate space by way of professional brokering and large footprint.

The MoU provides Housing.com privileges to actively participate and be represented at all events and forums of the association. On the other hand, CREDAI will leverage Housing.com's technology superiority and innovation to create online proliferation for its communities.

Housing.com has raised over USD 100 million in capital from leading investors, including Softbank.

The portal has made some major appointments recently. Rishabh Gupta was appointed as interim CEO in July, while Jason Kothari was appointed as the Chief Business Officer in August to drive the company's growth in India. PTI

Real Estate Regulation and GST bills in next session of Parliament

The government is in the process of accelerating reforms and transforming India, Urban Development Minister M Venkaiah Naidu said at a function here.

Economic Times: Government is planning to push for the passage of crucial bills like GST and Real Estate in the next session of Parliament to accelerate reforms and spur growth and employment in the country.

The government is in the process of accelerating reforms and transforming India, Urban Development Minister M Venkaiah Naidu said at a function here.

"A number of crucial Bills including that of introduction of GST, Real Estate Regulation and Development Bill, for bringing accountability and transparency and enhancing employment generation are expected to be taken up for approval in the next session of Parliament," he said.
Despite the concerted efforts, government could not get through the GST due to the stiff resistance from Congress and other opposition parties in Parliament.

These Bills are important from the perspective of spurring growth and employment which is necessary for faster poverty reduction, Naidu said.

He said the government is also focusing on skill development, both in rural and urban areas in order to alleviate poverty.

On Smart City Mission, Naidu said ever since it was announced it has really brought the urban issues firmly on the agenda of the nation and all stakeholders including political class, media and the common man.

Stating that the country is urbanising with a furious speed, he said urban issues need to be addressed sooner than later.

Raising question whether one can rise to the challenge and deliver the goals under the Smart City Mission, Naidu emphatically said "answer is clear yes."

Drawing the broad contours of the proposed Smart City, he said "a necessary core infrastructure, sanitation, health and education facilities, clean and sustainable environment, good city governance and adoption of smart technologies to ensure decent living, and catalyses economic growth which is the need of the hour."

He said the success of India growth story is hugely dependent on the success once can make on the urban front.

"The centre has committed itself to support states and urban local bodies with central assistance of over Rs 3 lakh crore over the next five years, he said and added "The future of the aspirational India lies in the future of our cities." Source: The Economic Times

SEBI demands tax concessions on real estate investment trusts

Seeks clarity on taxation of FIIs in infrastructure corporate bonds

Indivjal Dhasmana  |  New Delhi 

June 21, 2014 Last Updated at 12:18 IST

Ahead of the Budget, the Securities and Exchange Board of India (SEBI) has taken up with the government taxation issues for the proposed Real Estate Investment Trusts as well infrastructure  corporate bonds. 

"We have come out with a discussion paper on Real Estate Investment Trust and are hoping to get it implemented soon.  Our rules are ready, we have taken up with the government that these must be given a pass-through certificate status so far as tax status is concerned," SEBI chairman U K Sinha said at a summit organised by Skoch Consultancy Services. 

Sinha expressed the hope that the government will consider the demand favourably. 

"The moment there is a clarity on that, we will come out with our regulations," he said.

Sinha also  wanted a tax clarity on infrastructure corporate bonds for  foreign institutional investors (FIIs). 

"In the infrastructure sector, if a bond is issued and there is a FII, which is investing in that, what is the level of tax with that entity? If  it is vastly different from the withholding tax which is imposed on others, should there be different set of rules for FIIs and domestic institutional investors? These are the issues we are looking at," Sinha said. 

He  also  wanted the government to enact a  law  to replace  an ordinance which provides  SEBI the regulatory jurisdiction of  all  unregulated entities  that take  deposits of at  least  Rs  100  crore.  

"An ordinance is an ordinance. It has a limitd life. I am hopeful that the government will consider that this ordinance is converted into an act very soon," he  said.    

The SEBI chairman said there are still a large number of unregulated fund raising activities. These are coming under various names--chit funds or nidhi companies, housing schemes. 

"That menace has not still been fully controlled."

Sinha disclosed that  since the  ordinance  was promulgated, SEBI has taken action in more than 25 cases. "We have passed our orders, we have stopped them from raising money." Source: Business Standard

Indian realty industry to almost double to $140B by FY17

BY  Pooja Sarkar, VCCircle

The industry, which had been growing at around 8 per cent annually during 2009-11, saws a 6.5 per cent deceleration in 2012-13.

The Indian real estate industry is expected to grow to approximately $140 billion by FY17, said a research report on real estate released by advisory firm Ernst $ Young and industry body FICCI. The report said, according to industry estimates, the size of the Indian real estate market was close to $78.5 billion in FY13.

Niranjan Hiranandani, chairman of FICCI’s real estate committee and managing director, Hiranandani Constructions Pvt. Ltd, said, “Mumbai urgently needs change of infrastructure with the support of government and also reforms in taxation, with 34 per cent of cost of an affordable house going out as taxes.”

The realty industry, which had been growing at around 8 per cent during 2009-11, saw a 6.5 per cent deceleration in 2012-13 primarily due to the sluggish domestic growth, rising input costs and negative global economic sentiments.

The sector’s major growth driver has been the pumping of capital through foreign direct investment (FDI) route. Between April 2011and July 2013, the sector attracted FDI of close to Rs 100,000 crore. The report, however, said the volume of FDI into the sector has been declining.

Even for private equity funding, the sector saw its peak in 2007 when $6.8 billion came in. In 2012, the industry attracted $1.7 billion from limited partners in realty projects across the country, as per the report.

For the first half of the current calendar year, the realty industry has seen investment of close to $1.4 billion and industry experts indicate that this year would be one of the better years compared to last four years.

With negligible sales and developers’ reluctance to bring down prices of properties, even banks’ credit exposure to the real estate and housing sector declined from 10 per cent as a percentage of gross bank credit in FY10 to 7.9 per cent in FY13. While bank construction finance continues to be the cheapest source of funding, another instrument which has caught attention of developers is raising money through non-convertible debentures (NCDs). Reflecting this trend, NCDs worth $4.2 billion were issued in 2012 compared with $3.8 billion in 2011.

The realty industry recently witnessed a few big-ticked buyout transactions in commercial office space by private equity funds. Over the last three years, it has attracted investment of $1.14 billion in commercial office space portfolio development.

(Edited by Joby Puthuparampil Johnson)

National Consultation on Draft Real Estate (Regulation & Development) Bill, 2011

A national consultation on draft real estate (development & regulation) is being organized by the Ministry of Housing and Urban Poverty Alleviation, Govt of India today at Vigyan Bhawan at Delhi. The consultation is expected to deliberate upon the recently formulated Real Estate (Regulation & Development) Bill, 2011.

The Draft Real Estate (Regulation & Development) Bill, 2011 seeks to establish a regulatory oversight mechanism to enforce disclosure, fair practice and accountability norms in the real estate sector, and to provide adjudication machinery for speedy dispute redressal.

This Act is in pursuance of the powers of Parliament to make laws on matters enumerated in the Concurrent List namely, transfer of property other than agricultural land; registration of deeds and documents, and contracts including partnerships, agency, contracts of carriage, and other special forms of contracts, but not including contracts relating to agricultural land.

The Bill aims at restoring confidence of the general public in the real estate sector; by instituting transparency and accountability in real estate and housing transactions.  Currently, the real estate and housing sector is largely unregulated and opaque, with consumers often unable to procure complete information, or enforce accountability against builders and developers in the absence of effective regulation.  The sector, in recent years, has also emerged as a source of black money and corruptions in the economy. The Bill is expected to ensure greater accountability towards consumers, bring transparency and fairness in transactions and reduce frauds and delays significantly. All of these factors would make sizable dent in the corruption in this sector.

The Bill is also expected to promote regulated and orderly growth through efficiency, professionalism and standardization. It seeks to ensure consumer protection, without adding another stage in the procedure for sanctions.

The salient features of the Draft Real Estate (Regulation & Development) Bill are:

• Establishment of a ‘Real Estate Regulatory Authority’ in each State by the Appropriate Government (Centre for the UTs and State Governments in the case of the States), with specified functions, powers, and responsibilities to facilitate the orderly and planned  growth of the sector;
• Mandatory registration of developers / builders, who intend to sell any immovable property, with the Real Estate Regulatory Authority as a system of accreditation;
• Mandatory public disclosure norms for all registered developers, including details of developer, project, land status , statutory approvals and contractual obligations;
• Obligations of promoters to adhere to approved plans and project specifications, and to refund moneys in cases of default;
• Obligation of allottee to make necessary payments and other charges agreed to under the agreement and payment of interest in case of any delay;
• Provision to compulsorily deposit a portion of funds received from the allottees in a separate bank account, to be used for that real estate project only;
• The Authority to act as the nodal agency to co-ordinate efforts regarding development of the real estate sector and render necessary advice to the appropriate Government to ensure the growth and promotion of a transparent, efficient and competitive real estate sector; as also establish dispute resolution mechanisms for settling disputes between promoters and allottees/ buyers;
• Authorities to comprise of one Chairperson and not less than two members having adequate knowledge and experience of the sector;
• Establishment of a ‘Real Estate Appellate Tribunal’ by the Central Government to hear appeals from the orders of the Authority and to adjudicate on disputes.  Tribunal  to be headed by a sitting or retired Judge of Supreme Court or Chief Justice of High Court with 4 judicial and at-least 4 administrative/technical members;
• Chairperson of the Tribunal to have powers to constitute Benches, for exercising powers of the Tribunal;
• Establishment of a Central Advisory Council to advise the Central Government on matters concerning implementation of the Act.
• Council to make recommendations on major questions of policy, protection of consumer interest and to foster growth and development of the real estate sector;
• Penal provisions to ensure compliance with orders of the Authority and Tribunal;
• Jurisdiction of Civil Courts barred on matters which the Authority or the Tribunal is empowered to determine;
• Both Centre and States to have  powers to make rules over subjects specified in the Bill, and the Regulatory Authority to have powers to make regulations;
• Powers to Central Government to issue directions to States on matters specified in the Act have also been specified.

Read the complete draft of the Real Estate (Regulation& Development) Bill, 2011 HERE