How Homebuyers Can Be Protected Through RERA?
RERA Act covers the rights of the property buyers and embodies duty on the builders. Before RERA act the property market used to run on the whiles and fancies of builders only. The property clauses of RERA act no more entails the bad practice by builders. RERA also extends to the builder-buyer agreement in a fair manner unlike before.
In this blog you will get to know your rights as property buyer as enumerated in the RERA Act.
What is the main purpose of RERA for home buyers?
RERA simply stands for Real Estate Regulations Act which was introduced on May 1st in the year 2016 with the primary purpose to protect the interest of the home buyers.
The main aim is to protect them from the malpractices of unfair builders. It came as a welcome move for the Indian home buyers since they can now address any kind of issue like project delivery delays, property pricing, quality of construction and for any other reason.
It will further bring transparency in the Indian Real estate sector.
Applicability of RERA Act
- This Act is only applicable on development of property and not on renting of property
- This Act covers all the residential and commercial projects which can include shops, offices and buildings
Features of the Real Estate (Regulation and Development) Act, 2016
- Helps in regulation and promotion of the real estate sector
- Ensures sale of plot, apartment of building or sale of any real estate project in an efficient manner
- Protects the interests of the buyers in the real estate sector
- Results into speedy redressal of any dispute, in case it arises.
- Keeps an eye on all the transactions which takes place between the buyer and the promoter of the residential real estate projects
What you must know as a buyer before investing in property?
- All the residential real estate projects now need to be registered with this Act
- Promoters are now not allowed to book or offer any project for sale without registering it
- Real estate agents also need to register with RERAs
- Promoters of the project also need to upload all the details of the project on the website of the RERA
- Any amount collected from buyers must be kept in a separate bank account and must be utilized only for the purpose of the construction of that project.
- It gives right to legal representation on behalf of client by Company Secretaries or Chartered Accountants or Cost Accountants or the Legal Practitioners
- This Act also prescribes the penalties on the promoter or the real estate agent.
What are the advantages of RERA?
Exempted projects under RERA
The following projects do not require getting register under this Act:
- Those projects whose area of land does not exceed 500 square meters
- Where the number of apartments does not exceed 8
- In case of renovation, repair or re-development.
Disclosures by Builder to home buyers under RERA
The following disclosures by the Builder are mandatory required:
- Number, type and the carpet area of the apartments.
- Consent from the allottees for any major addition or changes.
- Quarterly updating of the website of RERA with details such as unsold inventory and pending approvals.
- Time frame of project completion
- No false statements or commitments in advertisement.
- No arbitrary cancellation of units by promoter.
How to calculate Carpet Area under RERA Act?
It is the net usable floor area of an apartment excluding the area which is covered by the external walls, service shafts, balcony area, and terrace area. But it includes the area which is covered by the internal partition walls of any apartment.
Cost of Property = Carpet area *Rate per square feet
28 states and union territories notify RERA
- Now 28 states and union territories (UTs) have notified the RERA Act in the country.
- 20 states and UTs had already established real estate appellate tribunals under the legislation, of which, seven were ‘regular’ tribunals, while there were 13 ‘interim’ real estate appellate tribunals.
- Out of all the above, 22 states have fully-functional web portals under the legislation.
- 27 states and Union Territories had established the Real Estate Regulatory Authority.
- Out of the above 27, 13 are the regular regulatory authorities and the rest 14 are ‘interim’ authorities.
- Six north-eastern states – Arunachal Pradesh, Meghalaya, Manipur, Mizoram, Nagaland and Sikkim have now agreed to implement RERA. Earlier it was not notified in these states due to land and other issues.
How should a buyer file a complaint under RERA?
- Complaints can be filed under Section 31 of the RERA Act with the Real Estate Regulatory Authority or you can file it with the adjudicating officer.
- Complaints may be against promoters, allottees and may be against real estate agents.
- Most state government rules have laid out the procedure and form, in which such applications can be made.
- A complaint under the RERA is required to be filed in the form prescribed under the respective states rules. The complaint can be filed with respect to any project which is registered under RERA, within the prescribed time limit.
- However, in case of Chandigarh Union Territory or Uttar Pradesh,these are placed as Form ‘M’ or Form ‘N’.
We hope that you as a buyer get to know your rights and major details about how RERA Act works. For complete details and legal compliance you can reach Enterslice.
In case you are also one of the aggrieved property buyer , we can help you in filing a compliant and providing you end to end solution .