Shares in real estate companies rallied following the passage of the Real Estate Bill. DB Realty was up 4 per cent, while DLF was up 3 per cent and India Bulls Real Estate was also up 2 per cent in trade.
Thursday saw the passage of the which intends to protect home buyers. The Congress had extended its support to the Bill, which was passed by a voice vote in the House. It is touted as a major reform measure to regulate the vast real estate sector and bring order in it.
It is also likely to bring in greater transparency for the sector and help curb the flow of unaccounted money into the sector.
The good part of the Bill is the Escrow Account, which would force the real estate developer into keeping money into a third party instrument, which will be subsequently utilized for construction.
A lot of home buyers have been trapped as many delays have been noticed in construction. Some builders have just vanished leaving home buyers in a quandary.
There is also a provision of imprisonment up to three years for the promoters and up to one year for real estate agents and buyers in case of any violation of orders of the appellate tribunals or monetary penalties or both.