Parliamentary Panel Calls for Abolition of Real Estate Regulatory Body
A parliamentary standing committee has issued a stark recommendation to abolish the Real Estate Regulatory Authority (RERA), arguing that the body has largely served the interests of builders at the expense of homebuyers. The committee's report highlights systemic failures in consumer protection and regulatory oversight within India's real estate sector.
Key Findings on RERA's Performance
The committee conducted an extensive review of RERA's operations since its establishment under the Real Estate (Regulation and Development) Act, 2016. It found that the authority has been ineffective in addressing grievances from homebuyers, with delays and biases in dispute resolution processes. According to the report, RERA often sides with developers, undermining its mandate to ensure transparency and fairness in real estate transactions.
Specific issues identified include:
- Inadequate enforcement of project completion timelines, leading to prolonged delays for homebuyers.
- Lack of stringent penalties for builders who violate regulations, reducing accountability.
- Complex complaint mechanisms that deter consumers from seeking redressal.
Impact on Homebuyers and the Real Estate Market
The committee emphasized that RERA's shortcomings have exacerbated financial and emotional distress for homebuyers, many of whom face incomplete projects and legal hurdles. It noted that the body's pro-builder stance has eroded public trust in the regulatory framework, potentially stifling investment and growth in the housing market.
The report states, "The current structure of RERA appears to prioritize developer interests, contradicting its foundational goal of protecting consumers. This misalignment calls for a fundamental reassessment of its existence."
Recommendations and Future Steps
In light of these findings, the parliamentary panel has urged the government to consider abolishing RERA and exploring alternative regulatory models. Suggestions include:
- Establishing a more independent and consumer-centric authority with enhanced powers.
- Implementing stricter compliance measures and faster dispute resolution mechanisms.
- Increasing transparency in project approvals and financial disclosures by developers.
The committee's recommendations are expected to spark debate among policymakers, industry stakeholders, and consumer advocacy groups. If adopted, this move could lead to significant reforms in India's real estate sector, aiming to restore balance between developers and homebuyers.
