In just about a few weeks' time, RERA would become a reality. However, as home-buyers, how well-versed are you with its implications?
Touted to be one of the most ground-breaking announcements made by the government for the betterment of the real estate sector, RERA is soon going to become a reality. While the built environment of Maharashtra is eagerly looking forward to it and is well-versed with the implications of the same, as a potential home-buyer, it's imperative that you get yourself well-acquainted too. RERA Act was notified by the central government last year and now, it is the turn of the state governments to notify their RERA Act, which will come into force from 1st May 2017.
“Real Estate (Regulation and Development) Act, 2016 (RERA), a crucial move in the real estate industry, aims to create an institutional infrastructure for protecting the interests of consumers and developers and promoting growth of the real estate sector. As the residential real estate market is shifting towards the end-user, RERA is a step in the right direction and will safeguard the interests of the home-buyers, thus ushering in transparency,“ says Rajeeb Dash, head corporate marketing, Tata Housing.
WHY IS AWARENESS IMPORTANT?
Experts cite that the Act covers many stakeholders of the real estate industry such as real estate developers, agentsbrokers and homebuyers. There is an apprehension that compliance with the law could lead to an increase in the operating costs of a project on account of increased compliance; a new set of fees will have to be paid for the registration of the project; projects could start late in case certain approvals are not accorded on time. It is a good idea for state governments to hence, start educating homebuyers and other stakeholders of the real estate industry on RERA and how the Act would be implemented in their states. “The central RERA Act is already notified and now, the mandate is on the states to notify their individual Acts. Maharashtra has already released the draft rules and has closed the suggestion period. Now, the final rules will be released and the Act will be implemented within three-six months. The entire real estate industry, from developers to brokers and consumers, will be affected by the Act and it's important they understand the nuances of the Act, with special emphasis on compliance and their rights,“ suggests Mayur Shah, committee chairman CREDAI Banking and Finance Committee.
...ON AN URGENCY BASIS:
According to experts, the Act has different points, which are pertinent to specific stakeholders. With the developers, there is a greater mandate as they have more points of concern, which they have to be aware about to ensure that all their projects are compliant with the Act. The bro kers also need to be aware of their own compliance terms and the certification process.Consumers, on the other hand, ought to be made aware of their rights and the processes (pertaining to the adherence by individual projects), so that they will be able to make the right decision and seek the right form of redressal at the appropriate time. “RERA requires developers to keep 70 per cent of all the receipts received under a project, in an escrow account to be used exclusively by the project for which such receipts have been taken.RERA, by default, should apply to all projects where a Completion Certificate (CC) has not been issued. As per the provisions, the developer is liable for preventive maintenance and upkeep of the constructed property against any construction-linked defects for a period of five years.This, in effect, provides an adequate basis to hold the developer responsible for all such work that he had undertaken w.r.t the project from the date of transferring the possession to the last purchaser,“ says Sachin Sandhir, global managing director emerging business, RICS. Another key aspect is the liability of the land owners who are partnering with the developers to develop their land parcels. “While the other key players have played their parts, the true benefit can be derived only if consumers are aware about the implications of RERA,“ concludes Nidhi Seksaria, advisory partner and leader Real Estate, BDO India.