Power in the Hands of Home Buyers Now
Sep 01, 2016 Home Trading Steps
Delays in getting your home are one of the crucial problems any homebuyer faces. There is a long-long list of people who have gone through this problem. Hence, There is a high need for transparency and accountability in the real estate sector that will protect the home buyers. Rajya Sabha has thus provided a ‘legal protection shield ‘to them by establishing the Real Estate (Regulation and Development) Bill that aims to modulate this sector.
The Bill empowers the homebuyers in making an informed and correct choice about purchasing their dream homes which ensure timely delivery and provides a swift option for legal recourse in case the builder fails to deliver on his promises. Well! That will provide homebuyers with some amount of relief. It proposes setting up of a Real Estate Regulator and thus will bar developers from advertising or selling homes till they have obtained all approvals from the local authorities and registered with the regulatory authorities. These authorities will be established in every state. To bring more projects under the bounds of Regulator, bill says that all projects on land more than 500 square metres or 8 apartments will have to be registered with the regulator.
While registering, the developer will have to reveal all the project details and information. ( includes- detail of promoter, project plan, implementation schedule, land status, layout plan, status of approval, agreements, details of real estate agents among many others) Hence a ‘tip to toe’ disclosure will be there which will ultimately lead to empowering the buyers.
The bill also asks the developers to deposit 70% of their money collected from the home buyers into a separate bank account that will be utilised only for construction and payment of land. The bill also stresses on the mentioning of the actual carpet area and not just the super build area which also includes many other areas like common passage, stairs etc.
Not just that, the bill brings uniformity by ensuring that both buyer and developer have to pay the same interest rate. Earlier the builders contracts have mostly been ‘one-sided’ where the buyer paid a higher rate of interest and the builder, on the other hand, paid a lower one. The bill raises the liability level of the builder for the structural defects from a span of 2 to 5 years. Further, it also states that the projects plans can only be amended with the consent of the buyers of that concerned project.
There are a lot of builders who are not happy or satisfied with the scheme as it removes them from the power thrown and place the consumer instead. However, this bill is meant to bring the element of clarity for the home buyers and will make the process of owning a house way a lot easier than what it was.
The Bill empowers the homebuyers in making an informed and correct choice about purchasing their dream homes which ensure timely delivery and provides a swift option for legal recourse in case the builder fails to deliver on his promises. Well! That will provide homebuyers with some amount of relief. It proposes setting up of a Real Estate Regulator and thus will bar developers from advertising or selling homes till they have obtained all approvals from the local authorities and registered with the regulatory authorities. These authorities will be established in every state. To bring more projects under the bounds of Regulator, bill says that all projects on land more than 500 square metres or 8 apartments will have to be registered with the regulator.
While registering, the developer will have to reveal all the project details and information. ( includes- detail of promoter, project plan, implementation schedule, land status, layout plan, status of approval, agreements, details of real estate agents among many others) Hence a ‘tip to toe’ disclosure will be there which will ultimately lead to empowering the buyers.
The bill also asks the developers to deposit 70% of their money collected from the home buyers into a separate bank account that will be utilised only for construction and payment of land. The bill also stresses on the mentioning of the actual carpet area and not just the super build area which also includes many other areas like common passage, stairs etc.
Not just that, the bill brings uniformity by ensuring that both buyer and developer have to pay the same interest rate. Earlier the builders contracts have mostly been ‘one-sided’ where the buyer paid a higher rate of interest and the builder, on the other hand, paid a lower one. The bill raises the liability level of the builder for the structural defects from a span of 2 to 5 years. Further, it also states that the projects plans can only be amended with the consent of the buyers of that concerned project.
There are a lot of builders who are not happy or satisfied with the scheme as it removes them from the power thrown and place the consumer instead. However, this bill is meant to bring the element of clarity for the home buyers and will make the process of owning a house way a lot easier than what it was.
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