Great Move!! Owners Associations form FAOA to unite against Developers

Fighting unfair trade practices by developers, apartments owners of Gurgaon have come together to form the Federation of Apartment Owners Associations (FAOA) recently. The federation will be on the lines of industry bodies like FICCI and CII and will be a collective face and voice of apartment owners across the country.

The FAOA has till date 15 associations as members and is now building a database for publicizing the track-record of various developers for the benefit of intending apartment buyers. The Federation formed by a group of professionals will act as a common platform of associations to create awareness among apartment buyers of their rights and filing class-action litigation against builders.

For long, buyers of apartments have been afflicted by ambiguous super area definition cited by builders and with no regulatory body expect whatever the builder says. Another issue which every apartment owner invariably faces is the lopsided builder-buyer agreement which is always in favor of the developer. FAOA aims to do away with issues like these.

FAOA noted that apartment owners associations find themselves on a weak wicket because the ever increasing demand for housing and heightened anxiety among apartment owners to take possession, because of inordinate delay in delivery by developers, buyers ultimately accept whatever the developers demand.

The federation further noted that developers take advantage of the facts that buyers act individually at the time of booking and signing of agreements and that an apartment owners association is actually formed only during occupancy of flats. In many cases buyer are sometimes unaware of the fact that the developer cannot legally sell open-space as parking lot.

The federation in a recent launch highlighted the unfair trade practices by developers which are summarized below:

  • Selling open-space parking lots by developers is a huge scandal
  • Court orders, even Supreme Court directive, have been ignored by real estate developers
  • Developers throw to the winds the commitments they make to the authorities while seeking permission to build
  • Open space parking lots are sold openly and blatantly and developers have been getting away with it
  • In confronting developers, apartment owners associations have not much hope without:

    • Their unity at all India level
    • Class-action by a critical mass of apartment owners in such big numbers that courts are driven to action
    • Creation of an effective regulatory body.
  • Uniform regulation on a national level difficult accomplish because real-estate comes under state govt. jurisdiction.
  • Legislation governing real-estate in 8 states is based on the Maharashtra apartment ownership Act of 1963.

If you are an owner of an apartment and is a victim of unfair practices by your developer, you can contact FAOA at DG@faoaindia.org or call at (0124) 4354000.

Watch the launch of FAOA as its members highlight some of the issues faced by buyers: