What is the Real Estate Regulatory Authority (RERA) and why is it important?

What exactly is RERA

As there are many regulatory authorities in India for every industry. There is RERA for Real estate sector. It was a bill passed on March 7th, 2016 in parliament for the well-being of the home buyers and to help them from fraudulent builders and developers who make false claims to sell their properties. 500 sq meters of Land development or 8 apartments is the criteria for a property to qualify for RERA.

Importance of  RERA

RERA  Authorizes all the activities a developer perform from planning to delivery such as

•  Types of homes for sale,
•  Site plans like master and floor plans, 
• Down payment and EMI Schedules 
• Completion dates(Stages of) 
• Updates on the status of the project

As RERA has all the authority from Schedule to completion, there will be no discrepancies in terms of deliverables of the project.
RERA is really a boon to homebuyers, builders and developers in Bangalore too.

The impact of RERA on real estate

The builder can’t commit to providing any amenities or services which is not there or is unrealistic. The builder or an individual should face legalities just in case they are found in any such fraud. Buyer should also be aware of the important compliances involved.

• 70% of the amount for the project from the buyers has to be maintained in a separate bank account, to be utilized for the construction of the specific project only.
• Increased affirmation on the timely finishing of projects and conveyance to the purchaser.
• An increment in the construction quality due to responsibility on any defect for five years.
• Sharing data on project design, layout, necessary approvals, sub-contractors, land title status.
• The project should be Certified by an engineer, an architect and a chartered accountant in practice.
• Formation of RWA (Resident Welfare Association) inside determined time or 3 months after dominant part of units have been sold.

Benefits of RERA

There are many benefits which incur to the buyer when we are talking about RERA

• The carpet area standardization is one of these, before the RERA act is passed, the carpet area was not defined properly. The carpet area calculation had been going wrong before, which led to many misunderstandings on the pricing part.
• Promoters are not allowed to advertise without a RERA  number, this itself filters out the genuine listing rather than buyers filtering out.
• As said earlier, the funds are deposited in the account which is  exclusive to the development of the particular project, before RERA the fraudulent builders used to divert these funds to their favourite project. This is subsequently irradiated.
• If the possession is delayed, the buyer has all the rights to claim a refund.