Real Estate Act will reduce litigation, boost FDI flows: Report 24/08/2016


Real Estate Act will reduce litigation, boost FDI flows: Report
24/08/2016 14:30
The Real Estate Regulation Act (RERA) will bring transparency and authority in doing real estate dealings and hence will reduce the litigations going forward, reveals a FICCI Grant Thornton Report.
According to a survey-based report, RERA will boost the governance hold on the sector and will eventually lead to increase in Foreign Domestic Investments (FDI) into the sector in near future.
This will also improve the ease of availability of financing options in the market, the report said.
A major outcome of the survey is that industry feels that the rule of depositing 70 per cent of sales proceeds in a separate account will help in getting timely delivery of the project and eliminate fly-by-night operators in the real estate.
While various international markets have varying types of regulations, the sector is optimistic that the RERA is a perfect cut to solve the issues plaguing the Indian Real Estate Sector. Based on the responses and the interpretations drawn, one can conclude that the sector has given a thumbs up to RERA, the report highlighted.
The report recommends that the compliance of this Act should not become one more layer of approvals to be obtained, but to ease out the entire approval process. The Act should also consider the impact of transmission issues and make it more pragmatic for the developers to comply at the end given the importance and contribution of real estate once feel that the current way of reforms should continue.