The main object of RERA or Real Estate (Regulation and Development) Act, 2016 is toprotecting the home purchasers and boosts the real estate investments. Real Estate Regulatory Authority (RERA) stands for transparency in the real estate industry. It was brought to action to eradicate the existing discrepancies and problems within the sector. As per the RERA Act the RERA committees have been set up across India to promote uniformity and transparency, as well as to regulate the real estate sector. It has provided several rights to the home buyer and has also specified rules and regulation to be followed by all developer/builders.
RERA is a place where every builder or developer is required to inform homebuyers of the progress of construction offer then keys to their property by the mentioned date and abide by every rule outlined by RERA, to ensure accountability.In order to do so, authorities have made it mandatory for all builders/developers to carry out RERA registration before they start a project. In case of any wrongdoing by the developer or the builders, the home buyer can also file a complaint to this authority.
Importance of RERA
The RERA has great importance for the Real Estate sector as it is one of the leading revenues generating sector of India and it needed some transparency and a Regulating Authority which could keep a check on transactions dealt by the developers/builders. There are many things in the Real Estate Sector which are necessary now because of RERA.
For instance.
- The RERA is applicable to more than 76000 companies in India.The registration of the project and the Real Estate Agent is mandatory.
In new project, 70% of the fund garnished by buyers is to be deposited in an escrow account. - In an ongoing project, 70% of the unused fund is to be deposited in the in an escrow account.
- The buyer has the right to enquire all about the real estate project and get hold of all the documents related to the project.
The regulations imposed by RERA are important for the development and growth of the country’s Real Estate sector. It also provides a common ground for both developers and buyers and reduces the risks which were faced by people before its implementation.
Projects come under RERA
- Residential and Commercial projects including plotted development.
- Projects measuring more than 8 units or 500 SQ MTS.
- Projects without completion certificate before commencement of this Act.
- The projects which are only for the purpose of repair/ renovation / re-development which does not involve re-allotment and marketing, advertising, selling or new allotment of any plot, apartments, and building in the real estate project will not come under RERA.
- Each phase is to be treated as separate real estate project requires fresh registration.
28 states and union territories notify RERA
As per the notification of October 24, 2018, 28 states and union territories have notified the Real Estate (RERA) in the country. According to the ministry 20 states and union territories (UTs) had established real estate appellate tribunals under the legislation. Under which seven were ‘regular’ tribunals and there were 13 ‘interim’ real estate appellate tribunals. 27 states and UTs had established the real estate regulatory authority and out of these there were 13 regular regulatory authorities while 14 were ‘interim’ authorities. Six north-eastern states – Arunachal Pradesh, Meghalaya, Manipur, Mizoram, Nagaland and Sikkim – have not notified the Act or are yet to notify the RERA and its rules due to the land and other issues. On the other hand West Bengal has notified its own real estate law the Housing and Industrial Regulation Act, 2017 instead of the RERA.
Conclusion
RERA has came as a remedy for the home buyers because of bad construction quality, delay in delivery of projects and not following the sanctioned plans were the common problems before the commencement of the Act. After the existence of RERA, it is not only protecting the interests of the home buyers but also providing benefit for the builders because of the greater transparency. The concept of RERA is flawless if it implemented as it is, but because of the non-compliance of the rules by some states and the developers it becomes very difficult to fulfill its exact purpose. The introduction of RERA is a huge step that is why the state Regulatory Authority needs to frame the rules according to the Act and not in the favor of builders.