The Government of India introduced the Real Estate Regulatory Authority Act in 2016 to safeguard home buyers’ interests and promote investment in the real estate sector. This Act was passed on March 10 and came into effect on May 1 2016.
Here is a detailed overview of the RERA Act to help you have a clear idea about its features, benefits and other crucial aspects.
RERA was inducted with the motive to enhance transparency and accountability in the housing sector. These are some of its significant features:
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RERA provides a host of benefits for home buyers, real estate agents, builders and promoters. These include:
With the RERA Act, it is now mandatory to obtain Occupancy certificates or Completion Certificates for registration of sales deeds of a particular project. However, there have been rampant registrations of units without proper Occupancy certificates.
These are some of the noted impacts of RERA:
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Promoters looking to register their projects under RERA can follow these steps:
However, the process for real estate agents is different:
Make sure to provide all necessary documents and information about a project with the buyers. Any misrepresentation or fraud will lead to the cancellation of registration.
To register any project under RERA, you have to furnish these documents:
As a prospective homebuyer, you should look for projects that have been registered under RERA Act. This will help you eliminate any risk of loss and get compensation in case of fraud.
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Ans: Promoters can face the following penalties under RERA Act:
For providing false information: 5% fine of the estimated cost of a project
Non-registration of the project: 10% fine of the project cost
Violation of provisions: Either 3 years of jail or a 10% fine of the project cost or both
Ans: As per RERA, the carpet area is the total floor area enclosed within the walls of an apartment. This does not include areas such as balconies, terraces, shafts, or anything else. This standardised definition of carpet area will make sure that dishonest promoters do not misguide homebuyers.
Ans: The applicable penalties for certain offences under the RERA Act are as follows:
Violation of orders given by the appellate tribunal: Imprisonment of up to 1 year or 10% fine of the price of the unit sold
Violation of Section 9 and Section 10: Rs. 10,000 per day fine till the default continues up to a maximum of 5% of the sold unit
Obtaining registration through misrepresentation or breaching the terms of registration: Revoking of an agent’s registration number
Ans: The following types of projects can get approval under RERA:
Projects of more than 500 sq. metres
Residential and commercial projects that include plotted development
Projects that did not have a completion certificate before the beginning of this Act
Projects meant only for repair, renovation or improvement and do not involve allotment of new plots or marketing or advertising will not qualify for RERA approval
Ans: 23 Indian states and Union Territories have so far established either permanent or interim regulatory authorities as of July 2017. Each state and UTs will have its specific regulator under RERA. Only 4 states Gujarat, Madhya Pradesh, Maharashtra, and Punjab, have set permanent authorities.
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