To regulate the real estate sector, the government had come up with the idea of Real Estate Regulatory Authority (RERA) Bill which is expected to help buyers. RERA is supposed to protect the interest of the home buyer and ensure timely delivery of projects. Real Estate Regulatory Authority (RERA) Bill was introduced in 2013 and finally the bill got approved in March last year.
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 (RERA).
So the question is how RERA will effect on the real estate industry? Will it help buyers or the developers?
How will RERA benefit builders?
The builders will also benefit from the RERA, as it proposes to impose a penalty on the beneficiary for not paying dues on time. Also, the builder will have the opportunity to approach the regulator in case there is an issue with the buyer.
How will RERA benefit home buyers?
Under RERA, not being able to get possession of apartments from the builder won’t be a problem anymore. Earlier, builders used to charge for the built-up and super built-up area. This means if the buyer paid for 1,300 sq.ft., they would only be able to use the carpet area of around 900 to 1,000 sq.ft. This is the net usable floor area of an apartment that only included the internal walls. While, the rest of the area was covered by the external walls such as lobby, service shafts, balconies, open terrace, balconies, common spaces, etc.
Under RERA, ‘carpet area’ has specifically been defined. Selling of property based on the super built-up area has been prohibited and can only be sold based on the carpet area. Additionally, developers will also require the consent of two-thirds of the buyers in a project before changing project’s design or any other structure. Also, the quality of the construction has been a concern for many buyers. Under RERA, any structural defect that takes place on the property for up to five years from the date of handing over possession will have to be repaired by the developer. Untimely delivery of real estate projects has been the biggest bane for the buyers. However, under RERA, the developer will be required to transfer 70% of the money received from buyers to an escrow account. Post which, the money will be withdrawn as per the stage of the construction, that will be approved by engineers and chartered accountants of builders.
Under RERA, regulatory bodies and appellate tribunals will be set up in each state to solve builder-buyer disputes. Any person aggrieved by any direction can expect a resolution from the appellate within 120 days. Earlier many developers promoted their projects with false commitments and offers. However, under RERA each advertisement will have to carry the RERA registration number, and all the promotions or advertisements will have to be completely honest without any false commitments.
To conclude: RERA promotes accountability, transparency & efficiency in the sector. Buyer is set to be King. Promoter benefits from king’s confidence. At Avant Infra, we follow the norms of the nation diligently and hence, our projects are RERA registered.
With Avant Infra, your dream of owning a home in pristine and plush locations of Mumbai will come true as our current line-up of projects offers something for all budgets. From affordable to luxury, we have it all with best in line amenities and construction quality. Give us an opportunity to guide you through our novel projects by scheduling a site visit.