As one the fastest growing economies of the 21st centuries, India features a vast landscape and an ever-growing population that required huge developments in commercial as well as residential sectors. Thus, land becomes one of the primary factors that need development in the country. Equitable land dealings and a transparent real estate agency becomes the need of the hour.
With a promise to protect the rights of the consumer and to provide more transparency, the RERA act has finally come into force. Let us take a look at what RERA is and why it matters.
What is RERA?
How will it benefit and protect you, i.e., the buyer?
There have been incessant complaints by home buyers against builders and real estate agents because of the difficulties they face when buying a house. Apart from home buyers, the builders and agents who do play by the rules have also had to face bias against them due to malpractice by others. Thus the creation of RERA, backed wholeheartedly by the government, comes as a huge sigh of relief.
RERA promotes a harmonious relationship between builders, agents, and buyers such that all three work in tandem with each other. The laws under the bill ensure that buyers are protected from any violation or transgression by the builders or agents and do not feel cheated. Some of the key benefits of RERA for buyers are as follows.
- Clarity on Carpet Area: Under RERA, the developer is required to mention the carpet area along with the super built up. A clear definition of the carpet area will be provided to the buyers so that there is uniformity and buyers will be able to easily compare the available choices.
- Ensured Quality of Construction: For a period of 5 years, builders will be liable to maintain any structural defects without levying any further charges.
- Better Financial Transparency: Of the total project cost, 70% will be put in an escrow account and will only be used to cover the cost of construction. The promoter too cannot accept more than 10% without an agreement for sale. The promoter’s accounts will also be audited.
- Timely Possession: One of the major problems in the real estate sector of India is delayed possession of home. Under RERA, all the under-construction projects will be checked consistently to ensure no swindling occurs. The chances of delay in possession due to government approval process will also be reduced as all approvals will have to be in place prior to marketing the project. The bill also ensures that common amenities such as gym, club house, and pool will have to be ready within 3 months of allotment of majority units in the project. Dispute settlement, if any, will also be fast-tracked.
- Informed Decision-Making: Since registering a real estate project will include the project details (such as plans and finance) and profiles of the developers, it will ensure transparency, authenticity, and background checks. Information about projects will be easily available to buyers through information portal. And any design changes will have to be consented for by two-third of the buyers.
How the bill will help in overall development of the real estate sector?
Real estate sector in India needs a fast-track development to meet the needs of the country. Because of lack of regulation in the past, many people have fallen prey to malpractice and negligence by developers. But with the advent of RERA, many such issues will be kept in check.
With the enforcement of high level of transparency and regulation, fly-by-night operators will find it difficult to set up shop. The policies under RERA will not only curb unethical practices by builders but also instill confidence in the buyers by granting them access to every aspect of real estate information through information portals. Considering the fact that there have been a few instances of unethical builders failing to give possession, which causes people to lose confidence in builders, the enforcement of RERA will help buyers regain confidence in the real estate sector.
What is the current status of implementation in Goa?
In Goa, the ministry of urban development is the parent body of RERA and is tasked with framing of rules as well as appointing the regulatory authority.
For more information about RERA, please visit www.merarera.com
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