According to the Global RealEstate Transparency Index (GRETI) 2018 report, Pakistan secured the 75th rank. The report was released in June 2018.
Standing on the 75th spot is a remarkable improvement for the country as it was the jump of almost 15 positions. Pakistan has moved up the ranks of the index’s ‘low transparency’ tier. According to the author of the report, The enhancement was subjected to ‘regulatory reforms and increased data collection and publication by government bodies’ by the report’s authors.
Considering this score, however, it soon becomes obvious that Pakistan still has a long way to cover.
The more alarming facts are the magnitude of the country’s real estate sector. The real estate sector of the country is one of the most important sectors of the country that impacts the lives of thousands in Pakistan. The real estate industry also has a deep influence over the national perspective as the industry is one of the major contributors in revenue-generation potential and in terms of role in the economy for the government.
The Problems Real Estate Sector faces
Looking at the current market, we’ve found some severe issues in the real estate sector that needs to be fixed as soon as possible. First of all, there is an immediate need for regaining investors confidence in the real estate sector. Secondly, secure investments is also a crucial issue. Apparently, the market looks directionless at times.
Generally, it has been observed that whenever property related dispute arises, most of the time they take years or even decades to resolve. This phenomenal essentially freezes investment capital that ultimately causes all-around losses.
The establishment of the Real Estate Regulatory Authority (RERA) is one of the most talked-about solutions of this issue.
The Federal Board of Revenue (FBR) Directorate General of Immovable Property (DG IMP) was formed recently with the aim of observing and resolving these issues. However, while a few sections of its main functions will overlap with those that are expected of RERA, the directorate is geared more towards widening the tax net and increasing the government’s revenue flows.
An authoritative body that is primed for the welfare, modernization and exclusive oversight of the real estate market is still needed. This is where RERA can truly play a decisive role.
A definitive body that is primed for the welfare, modernization and selective oversight of the real estate is as yet required. This is the place RERA can really assume a conclusive job.
Expectations From RERA?
Previously, extraordinary quarters inside the real estate industry have occasionally required the foundation of a regulatory authority. Likewise, a few government authorities have additionally consistently reported their plans for setting up such a body – specifically amid the last decade.
What’s more, with everything considered, the requirement for such an authority does not come without reason. The sector needs revisited laws, more oversight, and a strong structure for the rapid solutions of disputes. Any administrative body will be required to assess the situation and resolve every one of these issues.
Many of the functions that have been expected of, and attached with, RERA are listed as follows. The authority will:
- Have quasi-judicial power to resolve land disputes
- Advise the government on real estate matters
- Make recommendations to the government on updating laws relating to real estate
- Modernize laws relating to the transfer of property
- Improve the system of transfer of property both within and outside housing societies
- Introduce a new reformative structure, in collaboration with real estate stakeholders, to lower taxes while widening the tax net
- Introduce comprehensive laws to regulate the relations between consumers, investors, and housing societies/developers
- Register and license real estate agents, developers, and marketers
- Set uniform standards, practices, and regulations to ensure the smooth working of the real estate sector
- Handle real estate-related consumer complaints
- Have powers to inspect, penalize, and enforce its decisions
Enhancing jurisdictions, strengthening revenues
Recently, the Competition Commission of Pakistan (CCP), in its report proposing the formation of RERA to the government, also recommended training and certifying brokers & agents. This move will help both property buyers and real estate brokers in a number of ways. And most importantly, it will make the workings of the sector more professional, and boost public confidence in it.
Currently, the report by the Competition Commission of Pakistan (CCP) formally proposed the establishment of RERA. The report also suggested the training and certifications of brokers and agents. This strategy will dynamically assist property buyers as well as real estate brokers. Significantly, this step will help to established standards in the industry and will make its procedures and working more professional. It will also help to gain publics’ confidence in the real estate industry.
At the moment, there are hundreds of disputes and conflicts that occur due to the ambiguous overlapping of the authorities of the local development across the country. The establishment of an overarching regulatory authority will help to regulate these bodies. This comprehensive regulatory authority will also asses their performances and resolve any complaints registered against them.
Pakistani expats living abroad are of the most essential asset for the country’s economy. The remittances they send to their families living in Pakistan have for long offered a reliable and consistent source for the desperate treasury.
The establishment of RERA, as an added capacity, will address any uncertainty and confidence issues or concerns faced by the Pakistani expats. It will likewise help the administration in keeping up a lot of steady policies to counteract the notions of legislative problems.
We are observing the enhancement of regulations and documentation activity in the real estate industry of the country since the past few years. On all valid grounds, we are expecting this trend to continue in the future as well. The current circumstance will make property stakeholders anxious at least temporarily for some time. However, smart planning can still turn the market towards the boom.