RERA: New rules to make realty free of undesirable activity, says HDFC Chairman Deepak Parekh

New Delhi: HDFC Chairman Deepak Parekh today termed government policies on housing as practical and implementable and expressed hope that new regulations will stop "undesirable activity" practiced by some realtors.

Segments of the real estate sector in India have many a times been a hotbed of undesirable activity and these practices should come to an end with the recent establishment of real estate regulatory authorities across the country, he said in his annual message to shareholders.

The Real Estate (Regulation and Development) Act, 2016 (RERA) was passed by parliament in 2016 and the Union Ministry of Housing and Urban Poverty Alleviation had given time till 1 May, 2017, to formulate and notify rules for the functioning of the regulator.

RERA seeks to bring clarity and fair practices that would protect the interests of buyers and also impose penalties on errant builders.

HDFC Chairman Deepak Parekh

File photo of HDFC Chairman Deepak Parekh

Parekh said: "These regulators will be the confidence builders for consumers and watchdogs for compliance on the part of developers. Increased transparency benefits the entire housing ecosystem."

For years, he added, the market craved an 'enabling environment' that would foster an increased supply of homes at the right price points and help widen the target group of customers for housing finance players.

"This government's policies on housing are practical and implementable. With the benefit of four decades of experience in this field, I can confidently say that I have never been as optimistic about the housing sector as I am currently," he said.

Over the last 25 years, he said, the company seized every opportunity to diversify into various financial services as and when these sectors were liberalised.

HDFC has a unique structure as both, a single product financial company and parent of the group companies. "Our subsidiary and associate companies are decentralised and managed and run by independent boards. Our only call on our group companies is performance evaluation of the group CEOs, succession planning, acquisitions and key investments.

We now hope to extract greater value from our group companies and explore listing opportunities, where conducive," he said. To better reflect long-term value creation, investors of HDFC need to increasingly focus on the consolidated rather than the standalone entity, he said.

"To conclude, I would like to reiterate that India's macro-economic fundamentals have never been stronger than today. A number of structural reforms are underway which will place India on a higher growth trajectory. We are excited about our future as we are about India's future and we hope you partake in our optimism," he said.

Updated Date: Jun 23, 2017 18:29 PM

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