Leading credit ratings agency, Crisil, on Thursday launched real estate ratings, a first by any organisation in India, which would help common buyers make informed purchases in the sector in need of greater transparency.
The Crisil Real Estate Star Ratings will work on a project-specific basis and rate it on a on a scale of one to seven stars after comparing with other alternatives available in the same city, Crisil's Managing Director and Chief Executive Director, Roopa Kudva, said.
The agency also made public its assessments of 21 projects spread across nine Tier-I and II cities in India.
"A developer commissions Crisil and gives us access to various details needed for assessment. We take into account our parameters and rate the project. Once the developer accepts the rating, we go public with the rating and project analysis which will be given to common buyers for free," Kudva said.
Crisil's parameters include the past record of the developer, the infrastructure he is erecting, finishing, timely completion, cost overruns, after-sales service, legal issues like title and project innovations like green buildings.
The rating will be given mid-way through the project and will be under surveillance till project completion, during which it can be revised, she said.
There is a growing need in the market for objective, independent and credible assessment of real estate projects which led Crisil to launch the new product. "As disposal incomes rise, real estate is the biggest non-finance investment and there are inherent issues of the sector," she said, adding that the agency will soon complete 50 project ratings.
