Impact of Implementing the Real Estate (Regulation and Development) Act in the Construction Industry

Abstract

The Indian real estate sector is pivotal in the nation’s economic growth. The purpose of this study is to identify and evaluate the effects of implementing the Real Estate (Regulation and Development) Act in the Construction Industry in Gujarat, India. Utilizing a comprehensive literature review, 26 impact attributes were identified, and an extensive questionnaire was developed, collecting 96 responses from industry stakeholders. The data were analyzed using descriptive statistics, exploratory factor analysis, and fuzzy preference relations metrics. Findings reveal that consumer-centric standardization and transparency is the most critical factor, enhancing buyer confidence and market transparency, while price escalation and market uptrend is the least important. This research offers valuable insight for policymakers in improving the real estate sector’s transparency to protect buyer’s interests and boost real estate investment. The study underscores the necessity for targeted reforms to enhance industry standards and promote a more transparent and accountable real estate market in Gujarat. The study provides actionable insights for policymakers to refine and enhance the Real Estate (Regulation and Development) Act (RERA) by focusing on critical factors such as consumer-centric standardization and transparency. Industry stakeholders can leverage these findings to improve practices, boost buyer confidence, and ensure market stability. This study offers specific examples of how stakeholders have mobilized these insights from RERA’s implementation. Policymakers, for instance, have tightened regulations around escrow accounts, improving financial management and reducing the misuse of buyer funds. Additionally, enhanced dispute resolution mechanisms have been introduced, helping resolve conflicts more efficiently and building trust in the market. Industry stakeholders, such as developers and real estate agents, have adjusted their practices to better comply with RERA’s mandates. Developers have adopted more transparent sales agreements and improved project timelines, contributing to increased buyer confidence and excellent market stability. Standardizing contracts and project information disclosure has reduced confusion and disputes, benefiting all parties involved.