Legal Dept. Drafts Rules to Regulate Mumbai Real Estate – TOI
The Sunday Times of India reported the following. Excerpts and Outlook from a Mumbai Real Estate Broker.
To protect flat buyers from being short-changed by builders, the legal metrology department has, for the first time, prepared draft rules to regulate the construction industry. “It will curb unfair trade practices and provide right delivery of area to consumers in terms of measurement and sale of usable/leased area,” Sanjay Pande (LMD controller and special inspector-general) told TOI on Saturday. He added it was the first time in the country that such rules have been framed. The draft proposes penalties including fines and jail terms for repeat offenses.
This is a great idea and a move in the right direction to protect consumers who are mostly duped by scrupulous builders and developers in Mumbai. Consumer confidence in Mumbai Developers is extremely low. On several occasions, I have heard from end users, skepticism of getting what is promised. Developers themselves at the time of agreement and sales mention in the fine print that the plans are subject to approval and can be changed without any prior notice. This is mostly true for off plan projects or soft-launch and pre-launch sales.
A person cheated by a developer in terms of area or dimension of the property can make an application to the authorized officer to measure it and take legal action against the defaulter.
It’s important to bring in accountability in Mumbai’s real estate industry. There is a big gap which needs to be bridged. Human mentality is “If I can get away with it, then I will try it”. This is more so true within the Mumbai Real Estate market. The primary reason is the influence of the developers and builders. The complacent mentality of the end user and the legal structure present. However, the trend is definitely changing from what it was a decade or 2 decades ago. The more successful builders and developers are the one’s who have a self governing motto. They normally stick to ethics to maintain their goodwill. These new rules will help stabilize the ones that have malicious intent, provided the rules and regulations are implemented properly.
Pande had formed a committee to frame the draft rules, comprising experts from Indian Institute of Architects, JJ College of Architecture, VJTI and engineers from the Mumbai, Thane and Navi Mumbai municipal corporations. It also had representatives from the Maharashtra Chamber Of Housing Industry.
Mr. Pande is on the right path here. He has the right experts in place to draft the rules. The diversity includes Architects, Engineers from elite schools and universities along with the Members of Mumbai’s real estate industry – MCHI. Hopefully the end result should be a good balance benefiting not only the consumer and investor but also Mumbai’s real estate industry. It should be a win-win situation for both. However, this should be done as early as possible. Ambiguity in any market, especially Mumbai real estate is not a good sign for the market.