BATHINDA: Promoters of housing projects in Punjab are expressing discontent over a recently issued notification under the Punjab Apartment and Property Regulation Act (PAPRA), 1995. They argue that the new regulations will hinder development efforts, consequently affecting the state’s revenue from property transactions.
This notification seeks to enhance transparency by prohibiting the partial acquisition of land for projects before development begins. It also imposes strict regulations regarding the collection of external development charges. Prospective buyers, in contrast to realtors, believe that these changes offer them greater choice and transparency, safeguarding them from being overcharged and decreasing price volatility in plot sales.
According to government officials, this notification marks a significant step in refining the property business, aiming to mitigate severe fluctuations in residential property prices across various projects and protect prospective buyers from exploitation by promoters or agents.
The notification, issued by the Punjab Department of Housing and Urban Development on December 5 and made public recently, states that any promoter wishing to develop land for housing must apply with proof of complete ownership (100%) of the project land, along with necessary permissions and fees.
This amendment mandates that separate permissions are required for each development. Additionally, changes in sub-sections of PAPRA aim to streamline the process for recovering costs associated with external development works and charges from developers.
Gurwinder Singh Lamba, president of the Punjab Colonisers and Property Dealers Association (PCPDA), criticized the move, suggesting it is a tactic by the Punjab government to push its land pooling policy, ultimately benefitting larger developers while marginalizing smaller ones in the unregulated sector.
The new directive requires promoters to pay 25% of the total external development charges upfront within 30 days of receiving a demand notice. Previously, promoters could only acquire partial ownership of land initially, planning to buy the rest through sale proceeds from developed plots. “This new law is unfavorable to promoters and primarily benefits the government by potentially halting development projects as many may withdraw funding,” said an unnamed realtor.
An official from the housing and urban development department explained that this notification aims to eliminate malpractices and improve transparency in the real estate sector. Developers have frequently misled buyers with false information or failed to complete projects as promised, sometimes including additional colonies into the initial title without proper disclosure.
