9 Good Things for Home Buyers in Real Estate Regulator Bill
The Real Estate (Regulation and Development) Act came into force from 1st May 2016, as an act of parliament that seeks to establish an institutional framework that will administrate contracts between real estate sellers and buyers. As of now, home buyers had to make do with whatever deal they got from builders- biased contract terms, procrastinations running into years, inflated costs, last minute changes into the procedure and what not! However, this bill is touted as a guardian against all the prevalent malpractices in the real estate sector by protecting the interest of the allottees by encouraging liability, lucidity, and good organisation.
Following are some salient features of the implemented Act:
- A specialised forum will be set up in every state, in accordance with the law, known as Real Estate Regulatory Authority (RERA), which will serve as the common platform for redressal of grievance against any builder by maintaining minutes of ventures, agents, contractors and structured set of data on lawbreakers.
- This law empowers the real estate regulator to administrate both commercial and residential real estate dealings.
- It is now made essential for builders to provide all information such as design plans, government compliance, land title status, the stipulated timeframe for project completion, a list of promoters and contractors involved etc to the consumer well in advance before marketing the project. Any ramification relating to project specifications (Post sale), must be supported by at least two-thirds of customers before it could be implemented.
- This act mandates the developer to deposit 70% of realisation from allottees in a separate bank account to cover the land costs; construction costs etc, thereby preventing them from investing in varied new projects simultaneously with the booking money of one project.
- Under the law, the prevailing practice of selling an indistinct super built-up area by tricking buyers will come to an end. The developers will be able to sell units only on carpet area that is the net usable floor area of an apartment. This point has been further explicitly stated in the law.
- In the event of any delay, the developer is now accounted to incur costs equivalent to the same interest that is been paid by the customer as an EMI to the bank.
- Furthermore, the buyer can also appeal to the builder within a year of taking acquisition to demand after sales service if any defaults in the projects are observed. Quality defects have to be addressed by the latter.
- RERA shall address the complaints about violations and has the power to penalize defaulters. If convicted of the charges, the developer may suffer a jail term of maximum 3 years with or without a fine.
- Last but not the least, every undertaking that measures more than 500 meters or apartments in the number of 8 or above will have to be registered with RERA.
This Act ensures a cleanup drive in the real estate sector. With falling prices on properties across Indian cities, this act acts as an icing on the cake for many humble buyers.Tags: property buying, rera