The Confederation of Real Estate Developers Associations of
India (CREDAI) is imposing a new code of conduct on real estate developers in
the hopes of instilling more transparency and accountability in the market.
Experts at CREDAI say
middle-class consumers are complaining that developers are taking advantage of
them by demanding additional feels upon move-in, delaying taking possession of
properties and failing to meet basic development standards. The agency is
requiring its 8,000 members voluntarily sign the agreement as part of the
self-governing system. The agency reported success in a pilot program after
which the new code of conduct is modeled and has invested in advertising to
spread awareness to consumers of their new rights.
A new code of conduct
has been agreed by the Confederation of Real Estate Developers Associations of
India (CREDAI) with the aim of resolving complaints about the house buying
process.
The most common
complaints are a delay in taking possession of a property, failure to meet commitments,
additional money being demanded above the agreed price and ambiguities over
sold areas.
‘The primary concern
of the consumer is transparency and accountability. Many middle class customers
carry the perception that the developers are not answerable and that the only
recourse is litigation which is a long drawn and messy process,’ said Pankaj
Bajaj, president of CREDAI for the National Capital Region.
CREDAI has over 8,000
members and it requires them to sign a Code of Conduct which is a self governing
mechanism requiring them to adhere with prescribed levels of transparency with
their customers.
Apart from committing
to being transparent with the customers on area calculations, approvals status
and specifications, the Code of Conduct requires the developer to declare what
compensation will be paid if there are delays delivering a project.
According to Bajaj the
aim is to differentiate good developers and fly by night operators in a sector
which has been maligned for its opaqueness.
CREDAI has also launched
a Consumer Grievance Redressal Forum where any member of the buying public can
lodge a complaint against a CREDAI member.
‘We realized that self governance and peer pressure are powerful tools. We have been running a pilot project of this exercise and found that 90% of the complaints against developers got resolved due to the peer pressure from the CREDAI forum on the concerned developer,’ explained Bajaj.
‘We realized that self governance and peer pressure are powerful tools. We have been running a pilot project of this exercise and found that 90% of the complaints against developers got resolved due to the peer pressure from the CREDAI forum on the concerned developer,’ explained Bajaj.
The Forum has a panel
of experienced developers and legal experts who decide on the complaint.
Complaints can be lodged on the CREDAI website. There is also an advertising
campaign to increase awareness of the code.
‘Hopefully, this
programme will succeed in aligning the faith of the consumers with the intent
of fair and transparent developers. We also hope that as a result of this, the
market is going to start discounting non transparent developers where there is
no redress forum for complaints,’ added Bajaj. This article was originally
published at Property
Wire.
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