The Cabinet cleared 100% FDI under automatic route for real estate broking services on the grounds that real-estate broking service does not amount to real estate business and is therefore, eligible for 100% FDI. In a post-RERA (Real Estate (Regulation and Development) Act) the fact that all brokers need to register themselves with the RERA authorities has already led to some regulation and structure in the industry. Structuring of the real estate brokerage business and its transformation into financially compliant and end-user focussed businesses seems to be the thrust of the new law.
The consumer, who had taken centre stage in 2017 as far as primary market policy was concerned, is now being addressed in the secondary market business too. The switch may be slow and many more statutory interventions may be required before the 10-20% registered brokers grow to a large majority in the country. But structured finances will result in more training facilities and organised brokerage houses with which smaller brokers can get aligned and trained.
[Source: The Economic Times]