Real Estate Regulatory Act (RERA) And Its Benefits For Home Buyers

From May 1, 2017, India Real Estate Market finally embraces the revolutionary declaration by the Government- The Real Estate Regulation and Development Act (RERA). The act is about to bring clarity and fair practices that would protect the home buyers interest and take necessary action by imposing penalties on the developers. Each Union Territory and State is about to have its individual regulatory authority, who are going to implement the rules and regulations abiding the act.

Although there had been a stagnancy in real estate investments, there were no leverage on the inventory costs. The low demand and quantity of unsold units has compelled the developers to map all units with an elevated price tag.

However, after the declaration of RERA, builders are confident about demand of residential properties and are relived from the loss incurred due to piling of unsold inventories. 

RERA implementation totally takes care of the worries and concerns of the home buyers. Key benefits of RERA implementation are as follows:

• The developers will have to register any project to the regulatory authority. Until then, they will not be able to advertise, offer, sell, market or book any plot, apartment, house, building nor can make any investment in projects. Additionally, all the marketing advertisements will have to bear unique RERA registration number.

• The issues like delays in possession, price quality of construction, etc are going to get addressed by this regulation. The side effects due to changes in any of these details are going to be handled by the builders henceforth, which were earlier buyers concern.

• The developers will have to maintain a separate account for each of their projects. They need to deposit a minimum 70 per cent of the money from investors and buyers and this money can only be used for the project construction cost.

• Builders will have to submit the original approved plans for their ongoing projects. The other details like any alterations, the revenue collected from buyers, fund utilization, time needed for construction, completion and possession, will need to get a certification by an Engineer/Architect/practicing Chartered Accountant.

• There will be a website for access by the public, where details of all the registered projects under RERA will be displayed.

• The regulatory body will ensure about construction quality. However, the builder will have to rectify the constructional issue namely quality and services within 30 days if there are any complains by the buyers in front of the regulatory authority.

• If the delivery of project crosses the deadline as agreed upon, the builders will be returning the entire investment of the individual home buyers, along with the interest rate declared in the agreement, as in the model contract declared by RERA. Additionally, if the buyer doesn’t wishes to take the money back, the builder will be paying the monthly interest until delivery.

• RERA mandates that developers can request within 10 per cent of the property’s cost only as booking amount, before signing a registered sale agreement.

With all the directions proposed by RERA, it is obvious that the home buyers will be the maximum gainers from the current realty market in India. Several developers have already started abiding the primary rules in order to get relief from paying penalties and to get their part of benefits.

Book your dream home now and enjoy maximum benefits as the regulatory act is there to support in every step. Happy buying!!!