The Indian Real Estate industry is one of the biggest ones in the country. The commitment of this industry to India’s total national output (GDP) has been assessed around 6.5 to 7 per cent and the sector is also responsible for producing a huge number of career opportunities.
Despite being so vast and crucial to the economic development of the country, the industry was never actually regulated properly and had a lot of mist covered over it.
Taking all this in account, the Real Estate Regulatory Act, 2016 was brought in picture for straightforwardness of difficulties that were being experienced by the developers across the nation.
The different experts set up under RERA are encouraging the recommended systems regularly by evaluating the conditions being taken a gander at by the experts occasionally and proposing corrections to the grounded Real Estate Regulatory Act, 2016.
Under RERA, various authorities were established to monitor the proper governance of all the transactions in the sector. The specialists are additionally meeting through Conclaves, conversation papers, public input, and so on to accomplish the most ideal practices which would be appropriate to every one of the partners. As of late 01st National RERA gathering was coordinated by Uttar Pradesh Real Estate Regulatory Authority in relationship with the Government of India, Government of Uttar Pradesh, NAREDCO, CREDAI and National Home Buyer’s Association in which best cycles and practices formulated by various specialists were introduced which will help other state specialists which are as yet under the maturing stage to create to accomplish the essential things of the demonstration.
1. RERA Registration – Any project that is built over an area of 500 square meters or does have more than 8 housing units lies under the mandate to be RERA registered. RERA prohibits developers to either market or sale their product until and unless it’s been registered under RERA.
2. Separate Account – To cover the cost of construction and land cost of the project, every developer is required to open a separate RERA account in a scheduled bank as per section 4(2)(I)(D).
Every builder is required to open a separate bank account in which he has to deposit 70% of the total amount collected from the allotees.
The money from this account can only be withdrawn after submission of the certificate of CA, architect, and engineer.
3. Disclosure of carpet area – Carpet area, as defined in section 2(g) is the net usable floor area of an apartment, excluding the area covered by the external walls, areas under services shafts, exclusive balcony or verandah area and exclusive open terrace area, but includes the area covered by the internal partition walls of the apartment’”.
Every builder clearly needs to mention the carpet area of the units for sale in both brochure and agreement to sale.
4. Defect Liability – Section 14(3) of the RERA Act states that if there is any structural damage within 5 years from the date of possession, the builder is liable to rectify the damage within 30 days of complaint filing for the same.
If the builder fails to abide by this, the builder will be allotted a monetary penalty as decided by the concerned RERA authority. The penalty money will be given to the homeowner as a compensation.
5. Standard Agreement to sale – RERA has given the specified format of an agreement to sale. So every builder will be using the format provided by the RERA of the concerned state.
6. Quarterly update on construction – Unlike how it was earlier, when builders didn’t show any accountability towards the project, they now have to provide a quarterly update about the project details including the quantity of units sold, approval taken to date, Certificate from professionals.
This has made it easier for buyers to track record of their investment.
7. Advance agreement to sale – RERA prohibits builders from taking more than 10% of the total cost of the unit before entering into a written agreement.
8. Complaint filing – If the buyer has any complaint about the builder /agent, he can make a complaint to RERA. The RERA will resolve the complaint within 60 days.
9. Approval for alteration in the sanctioned plan – If a builder wants to make any changes in plan and common areas of society, then he has to take the approval of 2/3 allottees.
10. Agent Registration – RERA mandates every active real estate agent/dealer to be registered with RERA.
RERA is a colossal development forward to help buyers similarly as originators to stop the mischievous activities of the defaulting Promoters and give quick objective to the buyers who have been caught in the judicious circle of malafide producers.
For more information about RERA by reading our various blogs related to the same, stay tuned to The Real Talks.