Can one Model fit all?

Hyderabad: The irregularities in property sale/development agreement often lead to realty frauds. To put a check on these, the Supreme Court had earlier directed the Union government to bring a model builder-buyer agreement for the protection of home purchasers. As the Centre has recently proposed to prepare the same, there is a lot of buzz among the real estate developers as well as the aspiring first-time buyers.

The central government told the apex court that it would soon come up with a model builder-buyer agreement for residential property sales containing the core clauses in consonance with the mandatory provisions of the Real Estate Regulation and Development Act (RERA) 2016 to ensure uniformity across the country and to protect the home buyers from exploitative practices adopted by the realtors.

While the home buyers are happy with this, the real estate developers also welcomed the Centre's decision. However, some of them feel that there should be a provision allowing States to make changes as per their requirement and concerned laws and regulations, so as to enhance the ease of doing business (EoDB) and allowing expedited delivery to home buyers.

A model agreement is necessary for the interest of all stakeholders. Although there were differences in builder-buyer agreements earlier, things changed after the implementation of the RERA and there is more transparency in the operations and deals, said RajanBandelkar, Chairman of Raunak Group and President of the realty body National Real Estate Development Council (Naredco).

He further says, "a model builder-buyer agreement would obviously bring ease in the whole process. However, one size fits all approach would not be appropriate as every agreement can't be the same given the difference in the kind of project, ranging from Greenfield to redevelopment projects. An agreement should not be one sided, favouring any one party."

Other real estate associations have also expressed similar concerns. "Every home buyer must be safe. However, cities like Mumbai and Hyderabad cannot be considered in the same way," said Gummi Ram Reddy, CMD of Hyderabad-based Ark Group, and National Vice-President of Confederation of Real Estate Developers' Associations of India (Credai).

Citing an example, he said, "As per RERA, common areas shall be registered under the name of housing societies. In Hyderabad, housing societies are not active unlike the ones in Mumbai. Here, buildersare registering the UDS of the total land on the name of apartment owners. It's a tedious task for them to define the common areas and register them proportionately on the name of housing societies. Again, there will be several issues within the housing societies."

"Due to the greed of some builders and developers in cities like Mumbai, the RERA was enactedto protect the home buyers. The State RERA authorities must have some liberty to make adjustments as per local conditions depending up on the situation without compromising the interest of home buyers," Ram Reddy explained.