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               Mission Transparency in Realty

Real estate business is driven by trust and credibility. The credibility of one’s past delivery plays an important role in determining the brand strength. The fulfilment of commitment in the past projects is used as a yardstick for the future development. An established developer or an upcoming developer who intends to build a brand will never ignore the ‘transparency’ factor.

For any individual, buying a house is a dream they aspire for. Choosing the right home is once in a lifetime decision primarily using factors such as budget, location, amenities, developer etc. However, most important factor that buyers looks for is transparency and background of the developer while reaching out to customers.

Buying house is one of the biggest financial decision an individual takes. Investment decision in under construction project requires customers to comprehend the proposed project by developer and also his ability to deliver promised house in time. This results a long term association of customer with developer, he is buying both product and service as a package. Sharing all the information of the project in a transparent manner with the customer shall ensure that they are taking informed decision and are aware of all potential risk associated with under construction project. Since, real estate projects are not off the shelf item, it is responsibility of the developer to inform & educate the customer on various aspects of the projects. Nowadays developers are extensively using technology to visualize the development they are proposing, walk-through of development, rendered images of buildings, virtual tour, cameras at site to show real time activities etc are few such tools. Transparency and customer service along with quality are the pillars of creating brand and trust with customers.

In the last decade or so number of corporates and institutions have ventured into real estate sector and financial institutions and banks have significantly helped in expanding the market and brining in transparency and professionalism. it has been observed that registered residential/commercial projects are now marketed under public domains. A sizeable amount of mid and small sized developers include details of the promoters, project, layout plans, development works, land status and status of statutory approvals in various collaterals. The disclosure also consists of pro-forma agreements, names and addresses of all those involved such as real estate agents, contractors, architects and structural engineers which boosts the morale of the buyers.  However, such marketed projects need to match their development on site, price and location along with carpet areas mentioned during the campaigns. For example a decade ago, three or four persons would group together, make a colorful brochure with attractive commercial terms and woo the public with alluring offers. The customers were often taken for a ride, which was glaringly evident from the dilapidated structures at various stages of construction. In this regard, it is a must that a law should be enacted to curb all unhealthy practices prevailing in the real estate and construction industry ensuring timely execution of projects for transparency in this sector. The law enacted should appoint an authority which would hereby upload the status of developers and their projects in their area on their official website. Few initiatives taken by the developers like uploading details about the layout, design, approvals from various authorities, status of the project construction, details about brokers on their websites is the step in right direction. This is bringing transparency, as only registered properties can be marketed or sold.

Real estate sector requires association of the brand and customer for a period of more than 4-5 years. This long term association requires loyalty from both parties to sustain any brand in this unorganized market. Developers should ensure transparency in the amenities delivered so promised during the sales pitch. In this regard many mid and small sized developers are maintaining long term relationship with customers by providing for security of the project, maintaining greenery by planting trees regularly, resurfacing and repair of the roads, providing pest control, lighting replacement where required, repairs of high quality equipment in the children’s play area, etc. A lot of developers provide after sales service for the individual customers such as repairs of modular kitchen, a team of carpenter, plumber and electrician are also made available to take care of day to day need of any customer. This further enhances their image of the developer in the minds of the people. Many reputed developers have a list of completed, ongoing and upcoming projects on their website. This easily helps the buyer in getting an idea of number and types of projects that have been executed by a builder in and around the city.

Conducting construction business fairly that stands the test of public scrutiny, while basing decisions on facts, keeps developer on the tracks of success. Transparency through documentation and accurately formatted records, duly monitored and reviewed, is the key function to create the trust and goodwill. Being certified under ISO certifications and other protocols, signify standardization and adherence to best industry practices which most developers are now focusing on. Another positive sign is that the real-estate developers are coming forward and embracing the concept of third-party evaluation of their projects.

The cabinet approval of the long-pending Real Estate (Regulation and Development) Bill, 2013, is a significant first step towards bringing in transparency and governance to the sector. The new bill will create the framework for a regulatory body, the Real Estate Regulatory Authority (Rera), which will act as the central agency to co-ordinate the development of the sector, as well as promote transparency, efficiency and competitiveness. The move will also boost domestic and foreign investment in the sector and help achieve the Indian government’s objective to provide housing for all by 2022 through enhanced private participation.

Goods and Services Tax appears to be another benefactor for the real estate regime, primarily in light of the expected free flow of credit, which would improve cash flow into the sector. More importantly, as the GST regime is expected to impart greater transparency through market mechanism, it is imperative that real estate transactions form an integral part of the proposed GST design.

Further to conceptualization of single window clearance, there should be appointment of a team which can be trained to scrutinize and keep check on any violations. This requires an initiative by urban development ministry which in turn will have to coordinate with various central and state government departments for making it a success. Everybody, from the government to the industry to the consumer, all will benefit if it is implemented.

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