Budget 2012: NRIs look for transparency in real estate deals

The recent depreciation in the rupee provided a great opportunity for Non Resident Indians (NRIs) who were looking at remitting funds to India for investment. Having sent in their greenbacks, the next obvious thing to do was to invest the funds smartly. For a long time, real estate has been a favorite among the diaspora. Experts say that NRIs have always been interested in investing in India as they are familiar with the location, and realty has traditionally yielded good returns in the short to medium term. Moreover, many NRIs look at their property in India as a second home, a place they may want to come back to when they retire. Today, it’s not only residential properties that offer investment opportunities. Commercial spaces like offices and retail also provide good returns.

But the real estate sector in India has not always been easy to deal with. Common complaints include the developers’ demand for cash, delays in completion of projects, developers not delivering on promises and the sub standard quality of construction. And for NRIs who have spent a large part of their lives in developed systems, these pain points can be quite overwhelming.

Bring in the real estate bill, quick The proposal for a Real Estate Bill has been doing the rounds in the various State and Central Ministries for a while now. The bill is touted to be pro-consumer and some of the key points include: - a Real Estate Regulatory Authority in each state by the appropriate government (Centre for the UTs and state governments for states), with specified functions, powers, and responsibilities to facilitate the orderly and planned growth of the sector - mandatory registration of developers / builders, who intend to sell any immovable property, with the Real Estate Regulatory Authority as a system of accreditation - provision to compulsorily deposit a portion of funds received from the allottees in a separate bank account, to be used for that real estate project only - obligations of promoters to adhere to approved plans and project specifications, and to refund moneys in cases of default - the authority to act as the nodal agency to coordinate efforts regarding development of the real estate sector and render necessary advice to the appropriate government to ensure the growth and promotion of a transparent, efficient and competitive real estate sector; as also establish dispute resolution mechanisms for settling disputes between promoters and allottees/ buyers - Penal provisions to ensure compliance with orders of the authority and tribunal

The bill is being debated among various groups to iron out certain differences of opinions.

But as a consumer, one can only hope that the bill goes through quickly. While the budget itself will not deal with the bill, the Government would do well to give a direction and timeline.

Enable Professional real estate management companies Having purchased real estate in India, NRIs need several services for managing the property such as managing lease, paying property and other taxes, managing society dues and so on. Currently NRIs depend on parents or relatives living in India.

Professional real estate management companies can offer comprehensive services that would benefit NRIs.