The real estate sector got its own regulator from May 1, 2017, the date when the Real Estate (Regulation and Development) Act, 2016 (RERA) became effective in the entire country. Each state and UT will have its own Regulatory Authority (RA) which will frame regulations and rules according to the Act.
With the RERA in place, will the real estate prices move upwards especially in the residential market? The answer to this may not be as straight as an arrow. While the new rules call for a much stricter compliance and transparency, which may push the real estate prices up especially for the new launches, the large amount of inventory overhang in the system, will probably keep the price rise at bay till the supply gets over.
Ashish R Puravankara, Managing Director, Puravankara says, “With RERA’s stipulated compliances and regulations, the project launches may occur with lesser frequency than before. With new launches getting spaced out the appetite for existing inventories will go up but will also eventually dwindle. This equation will alter the ongoing demand and supply proposition in the market affecting the pricing across the industry.”