December 6th, 2023
The Maharashtra Real Estate Regulatory Authority (MahaRERA) on December 4 floated a consultation paper seeking public suggestions on its proposed regulatory framework for quality of construction. Initially, the framework will be optional for developers to follow, but at a later stage, it will become compulsory for all developers.
What is the proposal?
The framework proposes appointing third-party agencies to determine the quality of construction before giving possession to homebuyers. In the consultation paper, the MahaRERA has advocated Third Party Quality Monitoring that aims to guarantee construction quality right from the outset, rather than addressing costly, time-consuming, and distressing defects after the fact.
The MahaRERA has proposed to introduce a third-party quality inspection mechanism to ensure a thorough assessment of construction quality. Under this mechanism, the quality of construction will be audited at several phases throughout the construction, including finishing before giving possession to homebuyers.
The three stages defined by MahaRERA include auditing advanced stages of construction, before handing over the possession and for verification after rectification is pointed out by the auditor.
Stages of third-party audit
According to the proposal of MahaRERA, in the initial stages of construction, the third-party auditor will audit several parameters like the strength of the foundation, short column, grade beam followed by columns, walls, staircase and parapet, etc.
In the pre-possession stage, the third-party auditor will have to cover areas that include the living room, bedrooms, dining area, bathrooms, lofts, balconies, kitchen, etc. The auditor will also have to inspect the ceiling of the apartment, including all walls, windows, stair steps, stair railing, cabinets and countertops. The auditor's role will also be to audit electrical, plumbing and exhaust systems, fixtures, etc.
Once the inspection is done, in the third stage, the third-party auditor will have to inspect the shortfalls addressed and fixed by the developer, according to the consultation paper floated by MahaRERA.
Audit not mandatory
The MahaRERA has maintained that initially, this initiative will be advisory/ optional for all projects. Those projects opting for this initiative will be prominently featured on the MahaRERA website, ensuring that prospective allottees are informed during their decision-making process.
As the ecosystem develops and matures, the Third-Party Quality Inspection initiative is envisioned to transition into a mandatory requirement for all real estate projects, the MahaRERA said in the consultation paper.
As per current provisions in the RERA Act, homebuyers can bring to notice the defects in the quality of construction, and developers are mandated to fix them in a period of 30 days. However, the defect liability period is limited to five years from the date of possession.
Developers welcome the MahaRERA move
"The proposal by MahaRERA to regulate the quality of construction is a good initiative. In the coming years, developers who do not make extra efforts for quality will not get business. Homebuyers want quality construction. Most homebuyers are in the age group of 30 to 45 years, who are ready to pay for quality. Due to this, today or tomorrow all developers, branded or small-time, will have to shift focus towards quality and make it their priority," Rajendra Sharma, Chairman and MD at Ambit Realtors and Developers, told Moneycontrol.
"Steel and concrete are the two most crucial procurements that matter when it comes to quality of construction and we ensure quality checks at every stage even though it costs us more to get this done. Whereas when it comes to finishing, in our case we do it in-house considering outsourcing of finishing related work cannot get us what the homebuyer would expect," Sharma added.
CREDAI-MCHI, the apex body of developers, welcomed the MahaRERA move to regulate the quality of construction.
"The idea of introducing third-party auditors is seen as a positive move, enhancing transparency throughout the process of delivering high-quality homes to buyers. If it is implemented through a professional reputed private ( non-governmental ) third party agency, then we anticipate that the home buyers will be assured about construction quality. This will not only promote fairness in real estate transaction, but also serve to safeguard developers interest in the long run, said Domnic Romell President CREDAI-MCHI.
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