It has taken eight years for the Real Estate (Regulation and Development) Act, 2016, to come in force. It was proposed in January 2009, and came into effect from 1 May 2016. It is expected to bring in much needed transparency and accountability into the sector. The Act tries to cover a vast range of areas, starting from launch of projects to post-sales issues. But in many quarters, there are doubts about the Act’s implementation. We look at some of these points.

1. Registration of projects

2. Advance payment and escrow account

3. Sale based on carpet area

4. Penalties for developers

5. Faster judgements

A long way ahead

Though the real estate Act has come into force, it will take a long time to have an impact. Each state will have to form its own rules and regulator, based on the Act’s guidelines. We will have to wait and watch how things turn, once everything is clear. It is too early to predict any consequences of the Act on the sector. We may see some consolidation, as better organised developers will be able to survive. Small developers will have to push up themselves.

The Act is a step in the right direction, and most stakeholders believe that it will help boost home buyers’ confidence.