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Saturday, Sep 21, 2019

‘Unscrupulous brokers’ driven out of the market thanks to MahaRERA

Another reason for the fall in the number of brokers is the slowdown in the realty market which has put many out of business.

mumbai Updated: May 19, 2018 23:41 IST
Naresh Kamath
Naresh Kamath
Hindustan Times
The realty market has witnessed a fall
The realty market has witnessed a fall(HT Photo)

With the Maharashtra Real Estate Regulatory Authority (MahaRERA) in force, approximately 10-15 % of real estate brokers seem to have quit the sector.

The reasons — only registered brokers can sell MahaRERA registered projects; massive slowdown in the realty market; and overriding sentiments that there are no provisions in MahaRERA to protect the rights of the brokers even though they are made liable for penal action.

According to the Confederation of Real Estate Brokers Association of India (CREBAI), MahaRERA has brought into place a form of regulation of the brokers dealing with real estate. “There are approximately 1.30 lakh brokers in Maharashtra of which at least 10-15 % have shut shop,” said Milan Kamdar, President, CREBAI (Maharashtra).

“We are seeing many of the unscrupulous brokers quitting the sector ever since MahaRERA has come to force. Since the rules specify that brokers will be fined for misleading information, this has acted as a deterrent to many,” he added.

MahaRERA has mandated that any broker who wants to sell apartments in a registered project needs to be registered with the real estate authority. Till now around, 14,000 such realty brokers have registered with MahaRERA by paying ₹10,000 in charges. Any builder who registers his project has to disclose the list of his brokers and they in turn need to be registered with MahaRERA. The penal action for a broker who does not register or provides false or misleading information is ₹10,000 per day till the default is corrected. The fine can also extend to 5% of the cost of the apartment or plot.

Another reason for the fall in the number of brokers is the slowdown in the realty market which has put many out of business.

Realty brokers also agree that MahaRERA registration has boosted their profile but rue that their interests are still not protected. “Though we are made liable for any violation, there are still no rules made to protect our rights. Many times, builders and buyers tend to not pay us our brokerage and there are no provisions to penalise them,” said Prakash Rohera, KKarma Realtors, a leading brokerage firm.

Recently, MahaRERA chairman Gautam Chatterjee acknowledged this issue. “The act is new and we are still learning. It is true that issues such as non-payment of brokerage are still not addressed. It will take some time to get such provisions in the act,” said Chatterjee.

First Published: May 19, 2018 23:40 IST