Real estate bill passed, government says will bring property prices down

New Delhi, March 15 (IANS) The real estate bill pending before parliament since 2013 was finally passed on Tuesday with the Lok Sabha giving its nod as members cutting across party lines backed it. Terming the development "historic", Urban Development Minister M. Venkaiah Naidu asserted the new law will help bring down property prices.

Members rising above party lines including from the Congress, the Biju Janata Dal (BJD), the Revolutionary Socialist Party (RSP), the Rashtriya Janata Dal and the Indian Union Muslim League supported the Real Estate (Regulation & Development) Bill, which had been passed by the Rajya Sabha on March 10.

Replying to the debate on the bill in the lower house, Naidu assured that the government is also open to discuss with the builders if they have any issue with the bill.

"We are not against builders. If there are problem with the builders, I am ready to discuss it with them anytime," he said, adding the speedy land clearances for the real estate projects will help in bringing down prices of the houses.

"I say you will get more investment, you will get early clearances and the property prices will come down."

Naidu said the bill was brought in the house after consultation with several stake holders including the ministries of defence, civil aviation, environment and consumer affairs.

Expressing satisfaction after members expressed their support to the bill, he said: "It is a historic moment for the country as we are fulfilling the aspirations of the people who wish to own a house, giving them the needed protection. The bill will be giving credibility to real estate sector also."

During the debate, Congress leader in Lok Sabha Malikarjun Kharge extended his party's support, saying: "We want to pass the bill."

RSP member N.K. Premchandran and RJD's Jaiprakash Narain Yadav also supported it.

BJD's Kalikesh Singh Deo complimented the government for bringing the bill.

"There was an absolute screaming need for regulation to be brought in. Under the previous avatar, many laws and many authorities regulated different aspects of the real estate business environment. The excesses caused by the imbalance of power during negotiations between consumers and sellers were indeed extreme," he said.

IUML's E.T Mohammad Basheer also called it "a very good piece of legislation" but wondered whether there will be clash with the central law as various states also have legislation in this regard.

In his reply, Naidu stressed that the builders should fulfill the promises they make to the flat buyers.

"The builders will have to do their duty. Parliament is not interested in interfering with their activity. What you (builders) are committing, what you are promising, fulfill that. This is the only purpose of this real estate bill,” he said.

The minister also said that he will write to all the chief ministers requesting them to give speedy clearances to the real estate projects in their states.

A major benefit for consumers proposed in the bill is that builders will have to quote prices based on carpet area and not super built-up area, while carpet area has been clearly defined in the bill to include usable spaces like kitchen and toilets.

The bill makes it mandatory for all commercial and residential real estate projects where the land is over 500 square metres, or eight apartments, to register with the regulator for launching a project.

For failure to register, it proposes a penalty of up to 10 percent of the project cost or three years' imprisonment.

Naidu said the main purpose of the bill is to protect consumers' interest.

"Sometimes we are called pro-business, I do not mind being called that. After all business and industry (people) are also Indians," he said, adding the interests of farmers and consumers will be protected.