Need for real estate regulator. Keeping home prices under check.

India badly needs a real estate regulator. The Maharashtra Housing Regulation and Development Bill passed by the Maharashtra state assembly in July is a step in the right direction. The objective of the bill is two fold: bring about transparency in the real estate sector and empower the home buyers.

Most home buyers all over India, especially in the Metros, are subject to huge fluctuations in property rates plus a complete lack of transparency into the prices decided by the builders. Not only are the agreements one sided in favour of the builders (the customer has no recourse even if the projects are unduly delayed, but the reverse does not apply), tactics like pre-launch price, bookings using sample flats and non disclosure if the project is under financial strain is often hidden from the view of the customer. The result - A high degree of mistrust that has crept in over the last decade amongst customers about the real estate developers.

As reported in the Mint, the Maharashtra bill makes it "mandatory for builders to make complete disclosure regarding housing schemes or projects they are developing, where they are required to provide details of ownership of land, number of flats going to be built, the floor space index (FSI) applicable for a particular housing project and how they are going to finance the project."

The bill is a model which the Kerala government could imitate and adapt and tailor make depending on the conditions in the state. It will go a long way in driving more transparency in the sector, keep home prices under check and instill confidence in buyers who invest their hard earned money in buying their dream home.