With much speculation, RERA is finally being made applicable from May 1, 2017. The builders will benefit from this act, as it will impose penalty on allottee for not paying dues on time. Also, the builder will have the opportunity to approach the regulator in case there is any issue with the buyer.
With an aim to regulate the real estate sector, RERA bill has been introduced by the government. This act intends to work in the best interest of the homebuyer and ensure timely delivery of projects. Although RERA is a central law, its implementation will depend on state governments, as real estate is a state subject. Maharashtra government had approved the Real Estate – Regulation and Development Act and it will come into effect from 1 May 2017.
Here are few ways in which buyers are likely to be benefited by the RERA Act-
Each state has to setup regulatory bodies under the RERA act as appellate tribunals to solve the disputes between buyer and builder within 120 days.
The developer will have to maintain a separate account where 70% of the money collected from a buyer will be kept to meet the construction cost of the project.
If the commercial and residential land is over 500 sq. mt. or eight apartments, RERA will make it mandatory to register with the regulator before launching a project.
RERA also seeks to levy strict regulations on the promoter and ensure that construction is completed well on time and possession is given as promised.
The definition of carpet area will changes as per RERA- It will include usable spaces like kitchen and toilets imparting clarity which was not the case earlier.
A developer’s liability to repair structural defects has been increased to 5 years from the earlier 2 years.
Developers will be able to sell projects only after it has all the necessary clearances. Under RERA, builders and agents will have to register themselves with the regulator and get all projects with more than eight apartments registered before launch.
Real Estate Regulatory Authorities will ensure publication on their websites information relating to profile and track record of promoters, details of litigations, advertisement and prospectus issued about the project, details of apartments, plots and garages, registered agents and consultants, development plan, financial details of the promoters, status of approvals and projects etc. so that there is proper transparency.
The act just doesn’t benefit the buyer, but is also a boon for the developer. The real estate sector will truly be a much organised sector with the implementation of this act.