RERA has undoubtedly made India’s real estate market advance towards enhanced transparency. After the act was declared, Maharashtra was the first off the block to adopt it by launching a full-fledged ‘MahaRERA’ portal. One of the most comprehensive and detailed among the RERA websites deployed to date, it has become a valuable tool for end-users and investors during their decision-making process. This efficient adoption of RERA has benefitted Maximum City- Mumbai the most.
Apartment Sales Vs Vacancy
The Mumbai Metropolitan Region (MMR) is divided into three areas- Mumbai City, its suburbs, and Thane. An analysis of the residential market as of 4th October 2017 reflects that of the 3,465 residential projects registered under RERA, maximum sales were recorded in Mumbai City (24,681 apartments sold out of the 50,329 units available), followed by Thane (86,479 apartments sold out of 1,80,071 units available) and Mumbai Suburbs (87,126 apartments sold out of 1,81,155 available). A distinct observation is that supply is double and clearly outstripping demand.
Mumbai prefers living small, as the numbers reflect 2 BHKs to be the configuration of choice. Thane sold the maximum 2 BHKs (61,145 units) as compared to Mumbai Suburbs which sold marginally lower (60,728 units) with Mumbai city selling the least (11,142 units).
1 BHKs were the second preference amongst Mumbaikars, with Thane selling most 1BHKs at a count of 29,551 units, while Mumbai City sold 5,295 units and Suburbs sold 19,803 units. However, supply far exceeded demand in Thane with 62,000 1 BHK units available for sale and only 47% recording sales.
The luxury housing market performed better in Mumbai’s Suburbs as compared to the City. While almost 49% of the supply of 4 BHKs and 4 BHK+ sold in the suburbs, the city saw sales at 42% of the total supply in this category for the region.
Post RERA, apartment details are provided only on the basis of carpet area, making it easier to compare one against the other. This ensures that home buyers don’t get tangled up in the confusing and misleading jargon of ‘built-up ’ and ‘super built-up’ area and have a standard area comparison that is also physically measurable. Also, RERA not only regulates the capital flow of developers by means of an escrow account but also penalizes delay in delivery timelines, thus ensuring project completion and timely delivery.
The confusion of selecting an appropriate real estate agent has also been resolved to a certain extent. Only agents who are registered on the MahaRERA site against a specific project are allowed to sell units of the respective projects. Buyers also have access to the names of the contractors, architects and structural engineers associated with their chosen project, and are therefore able to take more informed decisions.
Investors can now access updated information on apartment sales post the launch of a specific project, as well as details on the common amenities and project infrastructure. In addition, they can analyze micro-market sales data in order to deploy more informed and hence efficient capital
RERA equals Trust
Being RERA-registered is not just a stamp of approval from the Government, but has now also become an essential trust mark for buyers and investors alike. Buyers understandably gravitate towards RERA-registered projects, even if they are not constructed by a reputed developer. It is also observed that many buyers who were earlier ‘fence-sitting’, are now taking the plunge with a sense of security and transparency now infused into the housing sector.