The real estate market has received its own regulatory in effect from 1st May, 2017. This is the date when RERA (Real Estate Regulation & Development Act), 2016 became active within the country. Every Indian state and Union Territory will have to follow the specified set of RA (Regulatory Authority) which will be responsible for framing the rules and regulations as per the Act.
Will the Implementation of RERA Impact the Real Estate Prices?
If you have been planning to invest in some residential area like apartments, bungalows or many more in Hyderabad, then this question might be of your interest. The answer to this question is not as straight as a line as of now. While the implementation of the new real estate regulations might escalate the prices of the real estate residential properties, it is presumed to be limited to the new launches. There is a huge inventory that still needs to be completed. Therefore, prices might remain at bay till the overall supply gets balanced. To read more on this topic you can check out this site to access all the information regarding real estate industry in hyderbabad.
A major portion of the current inventory in Hyderabad lies in the effect of residential properties that are under construction. There are several unsold properties in the city including apartments, bungalows and so more that would require at least a year to get completed and to be handed over to the owners. All of these residential projects are required to be registered under RERA. Therefore, they would adhere to the new rules.
One rule under the RERA policy calls for the sale of the real estate properties on the basis of “super area” and not on the “super built-up area”. Until now, the real estate sector has been giving out the properties and residential apartments based on the super built-up area. However, now under the effect of RERA, the real estate projects need to sold on the pure basis of the carpet area. Therefore, under the ongoing market trend, the carpet area for any real estate project is usually 30-35 percent less than the projected super built-up area of the given project. As a result of this, the selling out of the projects on the basis of the carpet area would result in the increase in the psf price of the particular project. The prices might rise by as much as 40-50 percent of the price upon the super built-up area.
However, the real estate experts in Hyderabad claim that even though the psf (per square feet) price would change, it would not impact the overall price of the real estate project to a greater extent. While the carpet area-based property sales might not have a direct impact on the overall pricing, the real estate buyers would now come in the position to take better and judicious decisions because there would be the provision of enhanced clarity upon the offered space to them.
As in the past, the builders used to have a field-day with the real estate projects, the provisions by RERA would now be ensuring stricter control and order on the overall management of the funds as well as on the timely handing of the residential projects to the home buyers. This pressure of the timely delivery of the completed projects would be reflected on the contractors who might charge high rates for the overall construction and completion of the real estate projects from the potential home buyers.
Any kind of delay in the possession of the residential projects by the home buyers would escalate the total cost of ownership, especially in the case of the home loan provisions.
With the strict RERA implementations, it is time for the home buyers in Hyderabad to look for properties till the duration of 31st July with caution.