The Real Estate (Regulation and Development) Act, commonly known as RERA, is a significant piece of legislation that aims to bring transparency, accountability, and efficiency to the Indian real estate sector. Enacted in 2016, RERA has had a profound impact on the way real estate transactions are conducted in India.
Key provisions:
Key provisions and effects of RERA on the Indian real estate sector include:
Transparency and Accountability: RERA mandates that all real estate projects must be registered with the regulatory authority. Also, developers need to provide detailed information about the project, including layout plans, approvals, and completion timelines. Moreover, this has increased transparency, enabling buyers to make informed decisions.
Project Delays and Defaults: Developers are now held accountable for project delays or defaults. They must maintain a separate escrow account for each project, where a certain percentage of funds collected from buyers is deposited. Also, this ensures that funds are used only for the specific project and prevents the diversion of funds.
Quality Standards: RERA enforces quality standards, and developers must deliver properties that meet the specifications mentioned in the agreement. If there are any defects or issues within a specific period after possession, the developer is obligated to rectify them.
Advance Payments: Developers can’t demand more than 10% of the property’s cost as an advance payment before signing a sale agreement. This prevents buyers from being burdened with excessive upfront payments.
Real Estate Agents: The Act also covers real estate agents, requiring them to register with the regulatory authority. Also, this ensures that agents adhere to a code of conduct and provide accurate information to buyers.
Title of Property: Developers must provide clear title and legal ownership of the land before advertising or selling units. Moreover, this safeguards buyers from disputes related to property ownership.
Effects of RERA:
Adjudicating Mechanism: RERA establishes Real Estate Regulatory Authorities and Appellate Tribunals in each state to address disputes and grievances. This provides buyers with a structured platform to seek resolutions.
Promotion of Fair Practices: RERA discourages unfair practices by developers, promoting ethical behavior and fairness in the real estate market.
Increased Investor Confidence: The increased transparency, reduced risks, and enhanced accountability brought about by RERA have led to improved investor confidence in the real estate sector.
Structured Growth: RERA has led to the consolidation of the real estate market, favoring organized and reputable developers over unorganized and fly-by-night operators.
Consumer Protection: The Act provides strong safeguards for homebuyers, giving them a platform to address grievances and seek compensation for any unfair treatment or breaches of agreements.
Overall, the Real Estate Regulatory Act has indeed brought about a revolution in the Indian real estate sector by transforming it into a more transparent, accountable, and consumer-friendly industry.
For More Details:
Contact: +91 7094434780
Mail: info@vspromoters.com
Visit: www.vspromoters.in