By blacklisting the builders who have defaulted on completing their previous projects on time, the Gurugram bench of the Haryana Real Estate Regulatory Authority (HRERA) has taken a bold step towards a key goal that the regulatory regime which came into effect in 2016 was mandated to achieve: that of safeguarding the interest of the homebuyers and ensuring that the real estate sector operates in an efficient and transparent manner. This step is welcome as even four years down the line, the dream of lakhs of investors of having a home remains distant, as is evident from the mounting court cases of cheating, fraud and delay in delivery of property against builders.
That there are nearly 50 such developers already on the list of the Gurugram area alone shows how widespread this practice is and that it has been continuing with impunity as real estate moguls flex their money and muscle power. A survey of the residential market of the country, including prime projects, in 2019 revealed that 1,665 RERA-registered housing projects were delayed by over five years. With thousands of consumers knocking at its door for justice, the Supreme Court has also ruled that it is primarily the government’s duty to step in to rescue them.
The HRERA decision to rein in the erring builders by denying them fresh licences shows a mirror to the regulatory authorities of other states as well. Nationwide stringency would restore the trust of the consumer as it serves to throw a spanner in the works of promoters taking to the immoral path of diverting funds collected for one project to another before finishing it — the common reason for missing timelines. This illegal practice leaves in the lurch the poor buyers who have invested their lives’ savings for a house. Add to it the arbitrary escalation in the cost of construction over the years and the middle-class buyer feels weighed down doubly. The pinch of paying EMIs and rent for extended periods, not factored into initially at the time of commitment, has been rendered more painful in these times of lockdown-induced job losses and pay cuts. Strict norms are needed.