Though India's legal authoritarian scaffold and matter processes are in a process of fruition, there are some somber issues that are causes for apprehension. The legal system is filled with loopholes. In property transactions, the shadow of uncertainty on ownership records as well as land titles looms large.
But it still makes for a convincing case to look at the real estate in the country from a more general point of view. Some of the legal issues in Real Estate India and solutions are discussed below:
Urban Land Ceiling Regulation Act (ULCRA)
The Central Government has repealed this law in 1999/2000, realizing its failure to be glad about the objectives it was created for. But the State Governments have been slipshod. Some states like Punjab, UP, MP, Rajasthan, Gujarat and Haryana have repealed this Act. States like Maharashtra, Karnataka, Kerala and Orissa are yet to act upon it.
The complete revoke will create a swarm of positive situation, for example, discharge more land into the market and lesser the price of land, which accounts for about 50% of the price of the real estate property in India. Experts preach that repealing the ULCRA in all States will help the real estate business to grow at 14 per cent by 2011-12 and increase its donation to national GDP by far. It will open avenues to the degree of creating an additional 4 million jobs.
- In a country like ours, where land accounts for about 50 per cent of the price of Real Estate property in India, the role of the Government is to present the right incentives for the most appropriate use of land and lay clear guidelines on how it should be used. Simply locking land can render it entirely useless to everyone while releasing it will certainly lower its price.
There are fundamental difficulties that result from unclear property titles: 90% of all the lands in India do not have clear titles depiction the land off the market and creating a shortage of land. This is due to poor record maintenance and intricate outdated processes.
On top of that remote connections come to claim tenure on one’s property. To go around these problems, some people take remedy in appointing a third local party as a legal buyer, by means of complex techniques similar to a Trust. As a result the property becomes gets shared possession and is put to different purposes, being used by one some months of the year and borrowed out by the other the rest of the time.
Legally speaking, the Real Estate market in India is not bright enough for stylish western practices as there are chances of being swindled by self-proclaimed local "experts".
- To make life simpler, all rationalized records must be computerized to increase lucidity in land ownership. Setting up Special Fast Track Courts to clear all legal land disputes in India in a short period of time, so that titles become clear for the buyers is the need of the hour. This will open up avenues for financing and investment for development and lower the overall cost of projects.
The cost of transferring land titles must be closer to the customary rates in developed countries from rates of 10 plus % stamp duties to sensible levels of 3 to 5 %. This will be a step in the right direction as sellers will be prompted to pay the lower stamp duties, instead of trying to writhe their way out of the twist of stamp and registration costs. The government will have a wider anthology base which will generate greater proceeds.
The high duties have encouraged unaccounted money being used in most real estate transactions in India. Further, the Registration practice should also be made translucent and much simpler, so that scope for changes/deletions and dishonesty are minimized.
- One can take heart from the fact that some States have realized that lower rates of Stamp Duties may translate into amplified revenues from registration of land documents, and have gone to the lead with their campaign and acted accordingly.
The Real Estate in India has outgrown the occupancy and rental control laws as they tend to keep a large part of the metropolitan properties off the market. The rental laws must be revised to protect the owner and his/her property from the resident. The most sweeping steps are needed for the slaughter of old tenancies and removing boundaries on increase of rentals.
- Owners should be empowered to retrieve their properties without having to seek mixture in court measures with long drawn out results. In fact the market should be allowed to settle on the payment amounts while giving the owner full shield for his/her property. This will provide safekeeping to the landlord and reduce the unaffordable deposit amount in the lease agreements.
Legal Formats
- POWER OF ATTORNEY TO PREPARE A LAYOUT AND SELL PLOTS
- POWER OF ATTORNEY TO RAISE MONEYS AND MORTGAGE PROPERTY
- POWER OF ATTORNEY
