How did the real estate industry react to RERA?

As we celebrate the first anniversary of the implementation of the Real Estate Regulatory Act, I would like to share some key insights and opinions of industry leaders which I have gathered across multiple discussions with them on the after-effects of RERA on the Real Estate Sector: 

1. India is a consumer driven market.
2. Affordable housing is critical and developers need to get into the affordable housing space in order to survive.
3. Even after RERA, entry barriers are still quite low for Indian Real estate market. It is important for developers to get more compliant.
4. Globally, consolidation has occurred in Singapore, Australia and Dubai while China and South East have scattered/fragmented markets. Consolidation is observed for growth in a shrinking market and is better suited for stable markets. In developing countries like India, there’s always room for growth and addition of new players.
5.  In India, signs of consolidation are visible more on a project Level than on entity level. Consolidation is preferred between developers with separate sets of expertise, for example, developers having approval expertise are tying up with developers having execution expertise. But mergers and acquisitions at the corporate level are unrealistic due to technicality issues existing in this model.
6. Post RERA, Professionalism will be more as compared to consolidation. It is important to remember that RERA is just one window, not a cure-all. Developers may also use assistance of the judiciary in case of a stalemate.
7. Innovation in real estate is important to sustain the change by venturing into non-traditional asset class such as student housing and education. We are not still seeing innovations in new asset classes. Every city, micro-market and street as its own unique characteristics and would require customised solutions.
8. Capital is driving professionalism.
9.  Foreign funds chasing distressed assets in India is a new trend that has emerged recently.
10. As opposed to earlier speculation that RERA will lead to mass consolidation in the Real Estate Sector, we see that consolidation is visible only among 40 odd developers in office, 8 in retail and around 6 in industrial. Retail has more opportunities for consolidations owing to standardisation.In South India consolidation is very limited.
11. Consolidation is happening more in greenfield than brownfield projects, more in Stressed markets like Mumbai and NCR and is confined to bigger names in the Market.
12. During a consolidation, most developers should avoid looking at an incoming developer as a fund provider.
13. If further consolidation happens, the process will be very slow.
14. The developer financing market is around 5 lakh crores.
15. Tier I developers have limited capacity and capability to execute the several projects simultaneously as there is a shortage of man power and equipment. Tier I capacity is also choking up due to limited development potential.
16. New incremental money is flowing to Tier II and Tier III cities. NBFCs majorly finance the Tier II developers and have easy accessibility. Non-corporate developers are getting good rates from these NBFCs and the excess liquidity is preventing consolidation amongst developers.
17. An interesting calculation was that on an average the number of projects per developer was very low, which means on an average not all developers are not churning out enough supply.