Here is how RERA is Transforming the Indian Realty Sector

Indian real estate especially the real estate industry is known for being unorganised an unregulated due to several cases of project delays, frauds, poor quality construction to name a few. Introduction of the Real Estate Regulatory Act (RERA) in March 2016 has revolutionised the entire sector by making it more regulated and systematic one. RERA came into effect on May 1, 2017 with several buyer friendly aspects to promote transparency, financial discipline, accountability and efficiency in the sector while building faith among the buyers.

So here are certain guidelines incorporated in RERA to prevent buyers from getting cheated from the corrupt players in the market.

•In order to handle project delays RERA have notified strict guidelines. If a developer delays the delivery of a project, the buyers can seek withdrawal of booking. The developer is bound to refund the entire amount to the buyer along with the interest. The buyers can go ahead with the project with a condition that the developer will be paying interest to the buyer every month till the property gets ready for possession. The developer is liable to refund the buyer’s investment within 45 days of it becoming due.

•As per RERA, it is compulsory for all builders to obtain RERA registration numbers for their respective projects by registering their projects under RERA with the respective state regulatory authority. Without the RERA registration number, the developer cannot sell or even advertise their projects. The developer is suppose to upload the project details, sales details, construction progress, commencement/occupation and other certificates etc on the RERA portal at regular intervals. Also the developers has to publish the unique registration number on all its marketing collaterals, advertisements, brochure or any kind of promotional matter.

•Now home buyers invested money are in safe hands. As RERA instructs developers to deposit 70 percent of the buyers’ invested money received for a particular project to an escrow account. This prevent developers from using the money for a particular project into other projects. This rolling of funds was one of the major reasons for project delays.

•Buyers can now opt for projects only from credible builders by verifying their details on the RERA portal.  They can verify builder’s track record, whether they are complying with RERA norms and have a good financial stability.

•The builder now has to clearly state the carpet area of a property. Earlier the builders charged buyers on the basis of super built-up area but now it won’t work in this way. The builder has to quote price based on the carpet area of the property.

•The developer cannot modify the layout, plans or specifications in any project without 2/3rd of the buyers’ consent.

•The developers cannot charge more than 10 percent of the total property as a booking amount. If the developer is found guilty of charging more than 10 percent then the developer invites a penalty of imprisonment of up to 3 years.

•Brokers are  also liable to get registered under RERA.  Property brokers as service providers  are liable for all deliverables to the buyers. Hence they must get register with respective  state regulatory authorities.

•Home buyers can file complaint against the developers or brokers which will be resolved within a span of 60 days from the date of complaint.

•If the buyer find any kind of structural defects in the building or apartment such visible cracks, plumbing issues etc after possession in the initial five years, then the developer is liable to rectify the defect within 30 days or the developer has to give compensation to the buyer.

•With the help of RERA portal, buyers can now have access to the vital documents like the project’s land title ownership.

With such guideline, RERA has definitely revolutionised the real estate sector while making it more organised, transparent and regaining the trust of the buyer and removing the unscrupulous real estate players.