Developers have been instructed by MahaRERA to open three separate bank accounts in a single bank, namely, 1) RERA Designated Collection Account- For all revenue received from homebuyers, 2) RERA Designated Separate Account- For 70% of funds allocated for project’s land and construction, and 3) RERA Designated Transaction Account- For balance 30% of revenue received. This decision will be effective from 1st July

RERA Designated Collection Account and RERA Designated Separate Account are legally protected from getting attached by any government agencies

Ultimately, this decision will help in enhancing the flat purchaser’s confidence and further improve the real estate sector’s credibility. This is another significant decision by MahaRERA for improved customer experience

 Starting July 1, developers in Maharashtra will not be able to take money from homebuyers and deposit in different bank accounts as it will become mandatory for them to maintain different designated bank accounts for purposes as stated by the Maharashtra Real Estate Regulatory Authority (MahaRERA).

So far, several developers have been asking homebuyers to draw payments towards different bank accounts for different purposes. For example, flat booking amount is deposited in one bank account and another bank account for amenities and infrastructure such as gymnasium, swimming pool, parking, etc.

To discontinue this practice and enforce discipline, ensure compliance, enhance efficiency, transparency, accountability and uniformity in financial operations of housing projects, thereby securing and protecting homebuyers’ investments, the MahaRERA has mandated developers to open three bank accounts in a single bank.

These include 1) ‘RERA Designated Collection Account’ for 100% of revenue from the flat buyer, 2) ‘RERA Designated Separate Account’ for 70% of funds allocated for project’s land and construction and 3) ‘RERA Designated Transaction Account’ for balance 30% of funds.

This directive will be mandatory to follow and effective from July 1, 2024. Relevant consultation paper was issued in mid-March to discuss the same with various stakeholders. Following extensive consultation and discussion, these measures will now be implemented.

Projects with more than one promoter will also have the flexibility to open a ‘RERA Designated Master Account’ to receive all collections from the homebuyers.

Section 4(2)(i)(D) of the Real Estate (Regulation and Development) Act, 2016, has a provision for dedicated bank accounts. This is to ensure transparency, financial discipline and better monitoring of transactions.

It is mandatory to segregate 100% of the revenue, that is the amount related to apartment’s booking and other charges (excluding government taxes and charges), received from the homebuyers. Thereafter, a minimum of 70% of the revenue will have to be transferred to another account, i.e. RERA Designated Separate Account, solely for land and construction expenditures. The balance 30% of the revenue can be transferred to the RERA Designated Transaction Account. Banks will facilitate this process through auto sweep. Funds in any of these accounts cannot be withdrawn via cheques, online banking, credit cards, debit cards or any other means.

With the entire operating procedures defined for receipt, expenditure and refund, the developers will not be able to excuse themselves, citing lack of funds, from returning the booking amount to those flat purchasers who intend to exit the project.

If a homebuyer cancels their registration, they will have to pay back 70% of the amount received as well as compensation for any losses from RERA Designated Separate Account. Interest on the amount will also be applicable. Furthermore, 30% of the original amount will be transferred from the developer’s RERA Designated Transaction Account.

In case of cancellation of a flat’s booking, the homebuyer in several instances has to take a time consuming and longer route of lodging a complaint, attending hearings, securing an order, sending relevant documents to the district collector for issuing of recovery warrants. This entire lengthy process will be shortened as funds will be available with the developer to refund and compensate the homebuyer for losses, if any. With bank details and funds available now, MahaRERA can efficiently provide instructions for recovery from the specified account. This decision will be crucial for such recoveries and prove to be a game-changer.

For the developer, the RERA Designated Transaction Account will be utilised for project related expenses other than land and construction.

RERA Designated Collection Account and RERA Designated Separate Account are legally protected from getting attached by any government agencies. The bank has to be vigilant that they do not allow creating any third party encumbrances on either or both of these two accounts. The collection and diversion of funds to any unauthorised accounts will be unacceptable.

All transactions in these RERA designated bank accounts will have to cease upon project’s completion. The bank accounts cannot be used unless MahaRERA extends the project. The developer cannot alter the bank account without MahaRERA’s approval.

Funds can be withdrawn only on submission of certificates from project’s chartered accountants, engineers and architects. If there is more than one promoter, their responsibilities will be as per their mutual agreement. This protocol has been made for the first time.

Due to several such provisions, there will be restrictions on misappropriation of money, transparency in fund’s utilisation, bring in financial discipline and immensely help in project’s timely completion.

Apart from this, many developers finance the project by mortgaging the land or flats or the entire project. Furthermore, they may divert funds from the project’s account without the knowledge of homebuyers. This lack of transparency could potentially lead to problems in the future for the project and buyers alike. Now, the promoter must declare the loans availed from any financial institutions against the mortgage of land or flats or the entire project. It will be mandatory for the developer to disclose the financial institution’s name, address, transaction date, sanctioned amount, withdrawn amount, balance amount, etc. The availed loan’s overall details along with amount utilized for construction should be certified by project’s Chartered Accountant with their UDIN number. It is only after following this process a developer can be allowed to withdraw the interest on loan.

Ajoy Mehta, Chairman, MahaRERA, “MahaRERA is committed to building trust among home buyers by legally empowering them to ensure their investments are secured and protected. MahaRERA has highlighted the legal rights of homebuyers in the housing projects concerning various crucial aspects such as parking, amenities, standardised agreements for sale, allotment letters, etc. To ensure financial discipline in project operations, MahaRERA has taken a crucial decision mandating opening of three bank accounts in a single bank for each of the projects. If a project involves more than one promoter, four bank accounts will be required. These measures will be effective from July 1. This move is aimed at having financial discipline and transparency in the managing revenue as well as expenditures related to project’s development, thereby enabling precise financial oversight in the real estate sector. Such a measure is expected to minimise potential delays in project’s completion, thereby benefiting homebuyers and enhancing the real estate sector’s credibility. MahaRERA is committed to fostering this trust.”

₹10 lakh crore debt sanctioned for real estate from 2018-23Also Read:

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It was also decided in this meeting to start the revival efforts from the projects which were closed even though 70 percent of the work was completed initially.

A total of six Self Regulatory Organizations (SROs) of developers are registered with MahaRERA. In this NAREDCO West Foundation, CREDAI-MCHI, CREDAI MAHARASHTRA, BUILDERS ASSOCIATION OF INDIA, MARATHI BANDHKAM VYAVSAYIK ASSOCIATION and Brihanmumbai Developers Association are included.

At present 5756 projects are lapsed in the state. Out of these, 1882 projects are in which 70 per cent of the work has been completed and yet to be completed. All these projects are not registered with the self-regulatory bodies. Out of these 624 projects are registered with these institutions. It has been decided to start the efforts to revive these projects from these 624 projects.

For this, developers’ organizations will be given complete details of these 624 projects. It includes 309 projects in Mumbai, Thane, Palghar, Raigad, 220 in Pune, 20 in Nagpur, 29 in Aurangabad, 41 in Nashik and 5 in Amravati. These regulatory bodies have agreed to help with the rest of the project even if they are not members. These projects will be taken up in the next phase.

For revival of these stalled projects, MahaRERA has divided them into 4 groups according to their current status. The first group includes projects that can be completed without compromising the rights of home buyers.

The second group will remain where there is a need to reconcile developers and home buyers. In the third group are projects that require the intervention of MahaRERA due to some difficulties in terms of local authorities or lending banks. The fourth group includes projects where the developer is missing and the home buyer can complete the project by replacing the developer.

In the first 4 phases of the above category, multi-level action is expected. E.g. As the project is stalled, the concerned developer will have to be induced to seek extension. Where there is a possibility of conciliation between the developer and the consumer, the representatives of consumer organizations should be involved. Such an application has to be made detailing the manner in which intervention is required by MahaRERA in respect of local authorities and banks.

Considering the seriousness and scope of this issue, these regulatory bodies should appoint experienced and senior members as heads of the conciliation groups to be constituted for this purpose.

These intermediary groups will include project architects, financial institutions, related developers, housing associations or home buyers and conciliators. This group will initially meet with the concerned developers in person or through a vision system to understand the reasons behind the closure of the project. The root cause of project closures will be explored. Can this project be revived after that? If it happens, they will give a report to MahaRERA about what can be done for it.

It will be insisted that only the developers come to these meetings of the conciliation groups, but representatives of the developers may also attend as per need. But in that case the representative on behalf of the developer. There should be decision making authority or the developer himself should be present along with his representative.

Initially, it was decided to consider projects in which more than 70 percent of the work has been completed or more than 70% of the funds have gone towards development. This will include all the projects registered with the developer’s organization or not. This list will be given to them by MahaRERA.

If there is a large number of such closed projects in an area and there is a need for more groups, the number of groups can be increased.

Distribution of Lapsed projects
624 projects as registered with SROs.
CREDAI- Maharashtra 221
CREDAI- MCHI 138
NAREDCO 168
MBVA 36
BAI 27
BDA 34

Also Read: PropTech Boom – Real Estate-focused Startups Increase 200% Since 2016

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Selecting the right builder for your dream home is a critical step. The builder you choose will be in charge of your home and everything it has to offer. There are far too many builders on the market, but who is the most dependable of them all? To find the best builder who will provide the best quality in terms of quality of material, architecture, and service, one must be cautious and conduct a thorough market study. One must compare, analyse, and select a builder who is the best among his competitors and provides what you require.

Here are some simple, yet crucial, pointers to help you choose the best builder for your home.

1.       Experience of the builder:

The industry experience of the builder you choose speaks volumes about his efficiency. If a builder has been in the market for a while and has consistently performed well, one can be confident that he provides both quality and service. An experienced builder will be well-versed in the industry, materials, and evolving architecture. You can be convinced that someone with extensive experience will construct high-quality homes.

2.       The one who meets your needs:

Each of us is looking for something unique in our ideal home. Different builders’ projects may include a variety of styles, scales, and lifestyles. Or, one builder may offer a wide range of options—make sure you choose something that meets your needs and that the builder you choose offers a home within your budget as well as the amenities and lifestyle that you desire.

3.       Quality checking:

A good builder adheres to timetables and is constantly monitoring the quality and progress of work. The work schedule should be transparent, and the buyer should have access to quality checking guidelines, regular updates on the progress of their home’s construction, and so on. A builder who has a thorough inspection process and follows it will provide you with the highest quality homes.

4.       Service and post care:

It is critical to not only provide a well-planned home but also to provide good post-occupation service. The builder should maintain the homes and amenities in order to provide a relaxing experience to their customers. A builder who does not provide good post-occupancy service does not qualify as a dependable option. Sometimes residents have problems maintaining their homes but do not receive the necessary assistance.

PS: Views Expressed in this article solely belong to the author and do not represent the views that of SquareFeatIndia

Also Read: Indian Green Building Council (IGBC) achieves a record 9.75 Billion sq. ft of green building footprint

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By Varun Singh

India is in its 75th year of Independence. The government has launched an initiative Azadi Ka Amrit Mahotsav to celebrate and commemorate 75 years of Independence and the country’s glorious history, culture and achievements. The real estate sector is one of the important sectors who have contributed heavily to employment generation and GDP of the country in these past years.

Post Covid, the housing market has seen a revival in demand due to the low interest rate regime. Recently, the increased input costs have already compelled many developers to hike property prices in the first half of 2022. The RBI’s three consecutive repo rate hikes have also added to homebuyers’ woes and together these factors can dent demand over the short-term. Repo rate hikes are a major concern for the real estate industry and therefore to mitigate this impact, realty developers are coming up with various offers to release the burden of the homebuyers.

Here are a few offers from developers which can be availed by the homebuyers this Independence Day:

Runwal Group
Runwal Group presents the Mega Freedom Offer! This festive season, you can buy a Runwal home with never-before easy payment plans offering a one-year payment holiday. Here’s a great opportunity to enjoy freedom from EMI’s and your home loan interest worries. These offers are valid across the Runwal Group’s finest lifestyle addresses in Kanjurmarg, Mulund & Dombivli. Offer valid for a limited period only on select inventory till 15th August 2022.

Rajat Rastogi – Executive Director, Runwal Group
“Independence Day is a milestone, for the country and also for us as citizens. The natural extension of this is to allow freedom and independence to touch every aspect of our lives. We believe owning your home gives the individual and the family true freedom from rents, uncertainty and allows a person to live on his own terms. As part of our annual independence day celebrations, we’ve launched attractive promotions across all our projects and are already seeing an excellent response. As a company, we’ve witnessed the best month ever in July and are very positive that August will be even better. The Runwal group has a laser sharp focus on customer requirements and these offers are but a reflection of that philosophy.”

Parikshit Pawar, Chief Marketing Officer, Shapoorji Pallonji Real Estate
“In India, the festive season is regarded as an auspicious time to purchase a home. It’s a time to embark on new journeys. Real estate developers incentivize homebuyers by sweetening the deals and bringing them to fruition. This festive season, Joyville too, gives its customers more reasons to celebrate with offers ranging from gold to home appliances and furnishings starting at Rs. 1.5 lakhs. The overall market sentiment has been very positive. We expect to see a significant surge in demand as we move closer to the festive season.”

Tridhaatu Realty
This Festive Season, Tridhaatu Realty brings an exclusive offer for their customers, where one can avail Premium 2 BHK Air Conditioned Homes furnished by IKEA in their project Tridhaatu Morya located at Chembur along with 20:70:10 payment plans, Zero Stamp Duty, Zero GST and spot booking benefits. The project is Nearing Completion. Offers are valid for a limited period and for limited inventory. So, hurry and grab the exciting offers!

Govind Krishnan Muthukumar, Co-founder & Director, Tridhaatu Realty
“As the country is about to mark its 75 glorious years of Independence, we at Tridhaatu Realty are celebrating the occasion by providing offers that will meet the modern needs of the homebuyers. We are providing our customers an attractive value proposition, amidst the rising property prices, where we should see their confidence in the sector increase, and boost consumption. We are optimistic that this season will give the much-needed positivity and hope the real estate sector needs.”

CR Realty
This Independence Day CR Realty launches an exclusive offer for the upcoming festive season at their project Primo located in Bhandup for potential homebuyers. Advantage can be taken of Flexi-payment plans, which include 50% payment at the time of booking and the rest at Possession.

Cherag Ramakrishnan, Managing Director, CR Realty
“We at CR Realty believe in supporting our customers and giving them the flexibility to tailor make their dream home purchase. This is why we have specially curated this offer for our potential homebuyers. The Flexi payment plan shall not only guarantee our customers a pocket-friendly deal but also give them a sense of freedom from investing a heavy amount at one go. This offer clearly reflects our confidence in the final delivery of their respective homes.”

Group Satellite
This Independence Day, Group Satellite is offering an assured bumper prize on every booking along with a 50% discount on Stamp Duty Charges for their residential project Aarambh at Malad. The buyers will get a chance to avail of bumper prizes such as 43 inches TV, 5 Gram Gold Coin, an Electric Bike & Fossil watch. The offers are only for a limited period of time, starting from 12th August 2022 to 12th September 2022. So, hurry and grab the perfect deal for your new home this festive season.

Himanshu Jain, VP – Sales, Marketing, and CRM, Satellite Developers Private Limited (SDPL)
“Our country is achieving the milestone of completing 75 years of independence and therefore we at Group Satellite extend happiness with some exclusive offers to let our customers feel the essence of freedom they get when they purchase their own home. All the offers are thoughtfully designed and put together. We as a company believe in providing the maximum benefits and quality life to our customers and shall continue doing it for the many more years to come.”

JP Infra Mumbai Private Limited
JP Infra launches an exclusive offer this festive season by providing a complimentary modular kitchen at their select projects of JP North located in Mira Road for potential homebuyers. The bumper offer is only for a limited period of time, starting from 13th August 2022 to 16th August 2022 for 1, 2 and 3 BHK spacious homes.

Also Read: In July 57% homes sold in the price band of Rs 1 Cr and over

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Real estate experts expect that the repo rate hike may have a short term impact on the real estate demand.

Kaushal Agarwal – Chairman, The Guardians Real Estate Advisory
“The RBI’s decision to hike the repo rate was aimed at re-anchoring inflation expectation and will eventually result in the strengthening of the economy. An unstable economy is not conducive to the overall health of the real estate industry and therefore, the RBI’s approach towards reviving the economy so far has enabled a robust recovery in the real estate sector. The all-time low home loan interest regime boosted the housing demand and helped the economy to get back to the pre-COVID levels. The rise in property prices due to the increased interest rates, metro cess and higher stamp duty has not affected the sales in the past couple of months which proves that there is a genuine demand. The move to hike the repo rate might temporarily limit the growth momentum of the sector but the demand will continue to sustain.”

Pritam Chivukula – Co-Founder & Director, Tridhaatu Realty and Treasurer, CREDAI MCHI
“After two years of unchanged repo rate, RBI ‘s decision to hike the interest rates to tackle the inflation was a no-brainer. The sharp acceleration of rates consecutively for the second time in a short period will have a short-term effect on the sentiment of homebuyers. The interest rates have been the biggest factor in the resurgence for real estate demand in the last two years. We hope that the State Government will step to lighten the homebuyer load by reducing stamp duty and premiums.”

Himanshu Jain, VP – Sales, Marketing and CRM, Satellite Developers Private Limited (SDPL)
“The prices of construction materials are already high and the decision of increasing the repo rate will somewhat dent the current demand momentum and add to the woes of developers. However, keeping the current market conditions and inflation in mind, the move by RBI was expected to keep the economy on the track in the current highly volatile scenario. For first-time buyers, acquiring a home is considered as the biggest asset and these short-term decisions are unlikely to have a major impact on a buyer’s decision.”

Jitrendra Shah, CEO, Rockford Group
“RBI’s decision to hike the repo rate was anticipated to keep the inflationary expectations under check. From the real estate perspective, this move will impact the overall growth of the industry by dampening sales momentum while property prices are already on rise. However, we believe that this may also encourage the fence-sitters to make the most of the current schemes offered by developers in the market and take the plunge.”

Shraddha Kedia-Agarwal, Director, Transcon Developers
“The recent announcement by the Reserve Bank of India on increasing the repo rate by 50 bps, bringing them to 4.90%, will affect the real estate sector to an extent. Banks will soon likely to increase the home loans that will directly impact the consumer’s buying behaviour. The real estate industry was expecting this move owing to tackle the tight inflation of the country. However, we believe that preference for owning a home by homebuyers and strong wage growth will continue to support the housing market.’’

Dr. Sachin Chopda, Managing Director, Pushpam Group
“RBI’s decision to hike the policy repo rate by 50 basis points was anticipated, factoring the rise in inflation. The rate hike is likely to shrink liquidity in the economy overall, especially impacting the investor’s sentiments. There will be a short-term pause on the minds of the investors while assessing the volatility of the current market dynamics. However, they are bound to return soon in the market once the normalcy is bounced back.”

Bhushan Nemlekar, Director, Sumit Woods Limited
“Due to geopolitical conflict, the input costs were already high and now with this rate hike, it will only dampen the spirit of the entire real estate value chain. Cost of borrowing for both developers and buyers will be impacted and this will result in undesired rate hikes across the spectrum. However, we did not see much impact on the buying spree in the last couple of months since there are genuine buyers in the market to keep the momentum going.”

Jitesh Lalwani – President, HomeSync Real Estate Advisory
“RBI’s decision to hike in policy rates will lead to increase in housing loan interest rates impacting on the EMIs but we are still bullish about the real estate sector. Homebuyers are more concerned over skyrocketing property prices rather than rising interest rates. We are still optimistic about the current growth run for housing demand since we believe that this move may push homebuyers who are still deliberating to seal the deal. However, we urge the Government to take some necessary measures to control the rise in property prices.”

Also Read: 406 Realty Projects in 2021 were stopped from selling flats

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Gold has always been a favourite investment vehicle of Indian households as many people transfer the yellow metal from one generation to another. The biggest advantage of Gold is that one can be flexible with investment size or the amount. Whether you have to put in Rs1000 or Rs 1 crore +, gold is accessible to everyone to buy. Also, gold is highly liquid.

Real Estate also scores high for investment purposes but in comparison to gold, real estate requires bigger funds and the buyer needs to have long holding power. Well, real estate can be an attractive long-term investment option where the property value increases over time. So, if approached in the right way, real estate can deliver you incredible profits.

The one thing that is common between gold and real estate is that both have a strong sentimental value for the Indian investors, with strong reliability and sustained nature. So how do you choose where to spend your money if you have a sizeable amount to invest?

Well, I would recommend real estate any day as there are various reason because of which real estate scores over gold. Let’s have a look at them:

Passive Income
Real-estate has the potential to create regular income with additional tax benefits.Whether residential or commercial, real estate has the potential to generate passive income for the investors in form of monthly rentals in cash, which gold investments cannot do.

Rate of Return
History suggests that real estate can give up to 15 percent of annual return, thanks to rising rentals. The value of property improves with the market and economy. On the other hand, gold is used to hedge against inflation, which means that the return from gold is in line with the inflation, which is aimed low by all governments. Also, gold shines, when your paper currency is depreciated, making the return nominal.

Volatility and Risk
Real Estate is a highly stable investment option, which comes with low risk. Property brings mental satisfaction due to it securing your future. On the other hand, gold is a commodity, which is traded on the bourses. It comes with higher volatility and risks of being stolen.

Expenses add to the Value
One may argue the property incurs the cost of maintenance and renovations, unlike gold which is altered at will. However, this cost not only appreciates your asset, but also allows you to take taxation benefits.

Long- term Value Creation
It is a no brainer that the value of real estate increases, the longer you hold it. It is simply because you can not create land and with rising population, the demand increases, which ultimately leads to price rise. On the other hand, gold can be purchased into digital form as well. This might reduce the risk of being stolen, but still is an intangible asset.

Aids the Economy
Real estate might require large funds, but survival of a lot of sectors depend upon it. From debt servicing, cement, housing finance, building materials and various others depend upon real estate at large. It also creates a large number of informal and indirect employment opportunities, serving the economy at large.

Tax Benefits
The investment in real estate comes with numerous tax benefits such as tax deduction on mortgage interest, operating expenses and legal costs, property taxes and depreciation.

The real estate investment is not only a safe investment but can generate better returns over a period of time while you are still earning a regular income if you are using it as a rental property. It is a great investment option for many reasons such as a fantastic tax advantage, and you can leverage it to build wealth and assets.

Annuj Goel is Chairman & MD Goel Ganga Developments.

Note: Views Expressed by the author solely belongs to him, not that of SquareFeatIndia.

Also Read: Will Real Estate continue to offer a profitable Return on Investment

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By Varun Singh

Since the time Mumbai got a new police commissioner in the form of Sanjay Pandey he has been interacting with citizens via different modes.

In his third Facebook live the police commissioner told the the city why was he upset with the builder community.

The police commissioner is upset because citizens are being harassed.

The Mumbai Police last week took action against Mahavir Developers in Chembur for carrying out work during the night.

The police commissioner himself informed via his live that under section 115 or Bombay Police act action was taken against the Developer in Chembur.

He said, “Builders work under limits, work till 10 pm.”

The police commissioner sounded unhappy with the apex body of developers in the city. He said, “I had called MCHI and they thought, saheb must be saying all this, but nothing will happen, OK, I think we had called those fellows, developers and given them warning, shall not misuse rights given to you (builders). But it appears this has not been listened to. Hold on, yesterday we took action in Chembur under Bombay Police act, but now we will take action under IPC.”

“You (builders) are getting very good business, limit your happiness to yourselves. Do not cause sadness to everybody else.”

Mumbai Police Commissioner, Sanjay Pandey.

The commissioner even asked developers to limit their happiness to themselves.

He said, “You (builders) are getting very good business, limit your happiness to yourselves. Do not cause sadness to everybody else.”

He delivered his final message to developers saying that. “My message to builders; do not harass citizens, do not take law into your hand.”

The police commissioner was very clear with his message, which means developers not working according to the set law will face the music.

Also Read: Builder fined Rs 1 lac for RERA Violation

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By Varun Singh

Hard to believe, but August 2021, sold more homes than August 2019, when the world was not suffering from any COVID-19 like pandemic.

However, August 2021, sold lesser homes when compared to July 2021 in city of Mumbai.

In August 2019, a total number of 5873 sales was registered with the Inspector General for Registration and Stamps.

The number was 2642 sales in August 2020, whereas it was 6862 sales in August 2018.

In July 2021 the home sales in Mumbai stood at 9823.

Finally in August 2021 the sales of home in Mumbai city stood at 6784.

According to Anand Gupta of Builders Association of India, “Actually in 2019 August it was 5900 and that time also industry was passing through bad phase because of side effects of Demonetization, GST , RERA etc. Still increase of 13% as compared to 2019 is very Good sign. it means after unlocking ,economy has come back to track and it will improve further.”

Ashok Mohanani, President, NAREDCO Maharashtra, said, “The real estate market has witnessed major bumps and has recovered majestically in the last few quarters. Largely, home-buying spree has massively been affected post COVID, where people have become more stagnant on buying permanent homes rather living on rent.”

Mohanani further added, “Purchasing your own home has consistently been a major part of our Indian ethos. Today, the ‘Mumbaikar’ who has gone to the city in a quest for his/her profession are looking for permanent homes with prolonged rationality and financing costs drifting around 6.5% for a home loan.”

The state head of the builder body says, several provisions have been provided by the government and developers during the unlocking phase of the economy that has made the current time, one of the best ideal opportunities to purchase a home in Mumbai. In 2019, homebuyers did not come across as many lucrative offers and deals as compared to now. Additionally, relatively low home loan rates, convenience in paying EMI and reduced stamp duty, is also encouraging the demand among consumers and fence-sitters.

He further said, “The prolonged moderateness combined with pandemic encouraged necessity for a permanent home, has fueled the home buying in Mumbai. The market has seen an additional interest of 10% over the past quarter for two and three BHK homes in the city.”

Also Read:Realty Sales in Mumbai, back to Pre-Pandemic days

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By Varun Singh

There are many reasons because of which disputes between homebuyers and builders come up and they approach MahaRERA for getting them resolved.

According to MahaRERA itself, during the course of the hearing of the complaints, the various issues of an agreement are arising by way of disputes.

To tackle this, MahaRERA has formed a Committee for giving recommendations on two issues; Model Agreement for Commercial/Residential Units/Plots and Draft for Allotment letter.

Real Estate (Regulation and Development) Act 2016 was enacted to bring greater professionalism, accountability, and competency in
real estate sector.

In accordance with the provisions of Section 13 of RERA, the promoters shall not accept a sum of more than ten percent of the cost of
apartment without entering into an agreement for sale.

MahaRERA in its circular has stated, it is observed that during the course of the hearing of the complaints the various issues of an agreement are arising by way of dispute.

Therefore, MahaRERA stated that it is necessary to consider modifying the Agreement for Sale.

Thus a committee has been constituted to advise and to give recommendations vis-a-vis suggestion in the Draft Agreement for Sale and Draft for Allotment letter.

The committee includes the following members:

Timelines and scope of work of the committee shall be in consultation with MahaRERA. It is expected that the committee would submit its report in 30 days.

Experts have hailed the move saying that this will reduce disputes between builders and homebuyers.

“It is an excellent move to amend the draft of allotment letters and agreements. The authority is looking to amend the Draft Allotment and Agreement letters. Many developers prepare additional “Booking forms” and “terms and Conditions of Allotment” to impose additional terms not provided in the Authority prescribed provisions. The same must be curtailed while issuing new model drafts and instructions. Additionally, to reduce several Section 13 violations already committed by developers, it has been observed in most cases that large monies are paid by purchasers and developers do not comply with Section 13, allotment letters are issued but the Agreements are not registered. The Authority must consider having developers make such declarations online, and/or rectify the same in a time-bound manner, to substantially reduce Section 13 violations,” said Prakkash Rohira – Advocate, Bombay High Court.

“It is a great proactive step taken by MahaRERA. Based on their observations and experts’ advice; now they can modify the Model Form of Agreement so that in futures fewer issues related to Agreement will arise between the developers and property buyers,” said Sunil Kewalramani, Advocate, Bombay High Court.

Also Read: Builder Takes MHADA To MahaRERA, Gets No Relief

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By Varun Singh

The state government’s announcement of 50% cut in premium construction, builders are expected to gain a lot.

Many builders claim that the real estate prices of homes will come down too, as the premium cut would mean savings for developers.

Mumbai alone attracts around 22 premiums which is higher than other top metro cities. 

For example, a top developer said, “The move of premium cut will lead to reduced cost for home buyers which will make houses more affordable thereby increasing their purchasing power, further underlining the opportune time for them to buy a house.”

Another builder said, “The reduction in premiums will over a period of time will make it a possibility of lower price for new inventories that shall come into the market.”

Developers availing the premium will have to pay the stamp duty for homebuyers.

When asked, Adv Shirish Deshpande, Chairman, Mumbai Grahak Panchayat, on whether he thinks, homebuyers will be passed on the benefit by builders due to premium cut.

Deshpande said, “I doubt. So long as their selling rates to homebuyers are not frozen, builders will be free to hike the prices and recover the stamp duty which is expected to be absorbed by them.”

Niranjan Shetty, Senior Mumbai BJP leader, and former Tree Committee Member, BMC says, “I don’t think so the developers will reduce their rates. Earlier, area’s like balcony which were not part of the FSI and for which the developer never use to pay a single paise after Subodh Kumar came in as Municipal Commissioner, started charging the premium for such constructions, the extra profit margin which was being pocketed by the builder had to be paid as premium. Now the developers will again benefit from this move. In my view nothing is going to change except that the developers will benefit from this kind of exemption.”

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