Finally, today Real Estate Act becomes applicable in India. RERA Act will be in application to protect the right of consumers and helping in transparency. Till now only 13 states and Union Territories have notified RERA Act.
The Union Government has described this act as the beginning of an era where the consumer is the king. This act will protect property buyers and also encourage private players.
The Real Estate Regulation and Development Bill 2016 passed in March 2016 and all the 92 sections of this act come into application from Today, May 1, 2017.
Housing and Urban Poverty alleviation minister M Venkaiah Naidu said, “The Real Estate Act coming into force after a nine-year wait marks the beginning of a new era,”
With this law, buyer will become King while developers will also get benefit in a regulated environment.
The developers will now have to get the ongoing projects that have not received completion certificate and the new projects registered with regulatory authorities within 3 months from today.
It is mandatory for all states and UTs to set up the authorities. But till now only 13 states and UTs have notified this rule.
The states that applied the RERA Acts are Uttar Pradesh, Gujarat, Odisha, Andhra Pradesh, Maharasthra, Madhya Pradesh and Bihar.
Last year, The Housing ministry had notified the rules for 5 UTs- Andaman and Nicobar Islands, Chandigarh, Dadra and Nagar Haveli, Daman and Diu, and Lakshadweep.
People can approach the court to notify the rules in their state. Across the country, there are over 76000 real estate companies.
Under this act, builders need to have mandatory registration of projects and real estate agents. Also Builders need to deposit 70 per cent of funds that is collected from buyers in a separate bank account for development of project.
With this rule, now builders need to complete the projects in time and they can withdraw it only for construction purpose.
If developers delay the project, they may need to pay penalties. Even developers need to share their project details on the regulators’ website and provide quarterly updates on construction progress.
RERA also states that any structural or workmanship defects brought to the notice of a promoter within a period of five years from the date of handing over possession must be rectified by the promoter, without any further charge, within 30 days.
There is imprisonment of up to three years for developers and up to one year in case of agents and buyers for violation of orders of appellate tribunals and regulatory authorities.
In India, approx. 10 lakh buyers invest for buying a house every year.
Real estate industry bodies CREDAI and NAREDCO said the implementation of this law will bring paradigm change in the way Indian real estate functions.
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