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| Swapnil Deshpandey/Unsplash |
A recently published white paper by Sotheby’s revealed that only 32 real estate projects were registered under the Delhi RERA. It is among the lowest in the country and is a cause of great concern.
Why Just 32?
Thanks to a clause that's more of a convenient loophole.
Presently, RERA rules exempt any development up to 500 sq. m. and having less than 8 apartments, from registering with the Delhi RERA. As a result, builders find ways to evade RERA registration by ensuring the number of units is less than the prescribed limit.
This malpractice is encouraged further when banks approve loans to homebuyers without proper scrutiny of non-RERA registered floors, giving homebuyers incentives and promoting unregistered projects.
One Sided Agreements
Most incomplete and delayed projects are a result of one sided builder-buyer agreements through General Power of Attorneys (GPAs). These transactions are undertaken to avoid paying registration stamp duty and the GST to the Delhi government.
Moreover, the agreements are structured in such a way so as to take full control of the property, and with RERA on a rain check, offer little to no protection to the original owner.
What can be done?
📌 The govt could amend the RERA act to reduce the threshold to 200 sq. m. or 4 units, which should cover almost 90% of the residential market of Delhi.
📌 Besides, to approve building sanction plans, completion certificate, and registration of sale deed, a RERA registration number could be made mandatory.