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RERA (Real Estate Regulatory Act) FAQ: Basic Question about RERA

The Real Estate Regulatory Act (RERA Act), implementing from May 1, 2017 will mark the start of transparent real estate between the homebuyers and builders. There is a lot about the act that needs to be known, and this section has the necessary information about the Real Estate Regulatory Act & Regulations, provided through the RERA Real Estate Act FAQ.

RERA bill was passed in parliament on 15th March 2016 and assent of president was given on 25th march of the same year.

According to the experts, implementation of the RERA Real Estate Act will bring in transparency in the real estate sector, and homebuyers will no longer have to feel worried about their investments. Similarly, the builders will now be made more responsible since they’ll have to meet the construction deadlines as well as the quality.

Objective of RERA are:

  • Protect the interest of consumer Uniformity and standardization of real estate sector as a whole.
  • Regulate the real estate sector with professionalism.
  • Need of regulatory authority to govern the real estate sector.
  • Fair play in real estate transactions.
RERA is beneficiary for real estate sector as a whole and consumer. Homebuyers will be the ones who’ll benefit the most from the implementation of the RERA Act. Currently, the interest rates are unimaginably low and the government will also provide a new scheme to provide subsidy on loan and small houses; also RERA act will be focusing entirely on affordable housing scheme.
The state government will have the power to assign the authority.
The state government will make its own authority or two state governments will mutually make their own authority.
Yes, RERA is applicable in every part of India except the state of Jammu and Kashmir, and RERA is applicable under planning area.

The RERA Act has most benefits for homebuyers in various parts of the country.

Some of the benefits include:
  1. 1. Increased assertion on the timely completion of projects and delivery to the consumer.
  2. 2. A step towards safeguarding their investment, as 70 per cent of the sales receipt will now be locked in a separate account.
  3. 3. An increase in the quality of construction due to a defect liability period of five years.
  4. 4. Balanced builder-buyer agreements.
  5. 5. Faster dispute resolution mechanism through dispute settlement forums and appellate tribunal.

With the bill being passed and the consumers being assured with transparency, this will revive the faith in builder irrespective of the fact if they are new or old as consolidate data about builders will be made available to the buyers now. This will shoot up the sales as consumers will be ready to invest in the real-estate market. Also, the builders do not lose much on the RERA’s decision to sell flats etc. according the carpet space.

Here are more clear benefits of the RERA Act for the builders-
1. Higher investment in the sector and a possible reduction in the cost of funds, leading to a lowered cost for the end users.
2. Grading of the promoters and projects.

The RERA act will benefit both the homebuyers and the builders, creating transparency between the two parties. This kind of transparency yields to more confidence and the number of buyers and investors would increase. Also, because RERA primarily focuses on the affordable housing scheme the number of buyers of affordable houses would definitely increase; thus affecting the real estate industry in a positive manner.
Benefits also include -

  1. 1. Increased scope for eliminating casual operators, leading to the better organization of the sector.
  2. 2. Minimum standards of governance and accountability have now been set to an extent, and there’s potential for driving standardization and professionalism in the sector.
  3. 3. Greater visibility into the developers’ delivery performances, segregating the established and casual operators.

 

Yes, every project has to be registered under RERA which under the criteria. Not doing so will lead to penalties and punishments.

Land size exceeding 500 sq mtrs and more than 8 units will fall under the criteria of the RERA Act, and must be registered under it.

Before registering your property under the RERA Act it is essential to know the requirements. Here are some listed for you-

Brief detail of enterprise.

  • A brief detail of project launched during past 5 years.
  • An authenticated copy of approvals and commencement certificate.
  • The sanctioned plan, layout plan and the plan of development works.
  • The location details of the project.
  • Performa of the allotment letter, agreement for sale and conveyance deed etc.

There are many compliance requirements which have to be compiled by the promoter for registering the project under the RERA Act. The builder is required to accumulate all the property data and papers before getting the property registered under RERA.

Yes, there will be fees which will be prescribed in state rules and builders can get their properties registered only after paying the fees.

As per the act, the project should be registered within 3 months from the date of applicability. Builders must make sure to not delay the registration process or they might be penalized for doing it late.

Customer shall be liable to pay interest, at a rate prescribed for any delay in payment towards any amount or charges to be paid.

Rs.10, 000/- per day up to maximum of 5% of the unit sold or purchase by him.

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