Hyderabad: The delay by the state government in setting up a RERA (Real Estate Regulatory Act) Authority has cost homebuyers and sellers dearly.
Eighty residential projects in the city that were approved by the government have come to a halt because they cannot get RERA registration in the absence of a RERA Authority and a website to enable registration of ventures by builders.
Builders say that the construction of 10,000 flats has been halted, which has resulted in decreased inventory.
Banks have stopped giving loans for homes in new ventures citing lack of RERA registration.
Builders say realty prices may spike
Though the state government notified the RERA in August this year, it has not set up the regulatory mechanism that will enable implementation.
“The inventory was 30,000 flats before RERA. Now, it has come down to less than 15,000. With no scope to launch new ventures or sell flats in the absence of RERA registration, the demand has increased for existing flats which has resulted in widening the gap between demand and supply,” said builder Indrasena Reddy of Giridhari Constructions.
Builders expect property prices to rise 10 per cent in new ventures due to the demand-supply gap. Builders are also finding it difficult to get funds for new projects with banks and financial institutions rejecting loans citing lack of RERA registration.
Sources said minister K.T. Rama Rao has recently written to the High Court requesting it to suggest the name of a sitting or retired judge who could be appointed chairman of the RERA Authority.
Homebuyers want the government to at least set up an ad hoc authority to implement RERA till a permanent body is set up, to protect the interests of buyers.
