RERA, (Real Estate (Regulation & Development) Act, 2016 is first set of the organised legal system to regulate the real estate industry. RERA Laws seek to bring transparency and accountability that would protect the interest of real estate/ home buyers and regain the lost faith in real estate industry.
RERA Objective: The main object of the RERA is to bring transparency, generate faith & confidence and reduce the litigations of real estate buyers. Some of the objectives of RERA are:
To establishing a Real Estate Regulatory Authority (RERA) for the sole purpose of regulation in real estate.
To provide transparency and grievance system in Real Estate Sector.
To protect of right of buyers.
To set up appellate System for grievance redressal system.
To bring confidence in real estate sector.
To prescribe the penalties for defaulters.
To establish the authenticity of promoters, real estate project and real estate agents.
To curb on unnecessary delay in approval of project, delivery of project etc.
RERA Registration applicability:
As per RERA Act, every developer shall register its ongoing and new project measuring more than 500 square meters in size and no. of the apartment does not exceed 8 inclusive in all phases, with respective State RERA authority. RERA registration is required for on-going project and new project as under-
On-going Project – every project which has not received completion certificate as on 01/05/2017 shall be required to get registered with respective State RERA authorities. Some State RERA has excluded the real estate project which has received occupation certificate.
New project – As per RERA Act, every project shall get RERA registration before any kind of advertisement, promotion, booking or offer to sell or any kind of invitation for the purchase of any part of the project.
RERA Compliances:
Periodical Update – Every promoter is required to update the status of the registered project on quarterly with the respective State RERA Authority. Audited financial shall be submitted on yearly basis.
Separate Bank Account – Every promoter shall maintain a separate bank account for every project and shall deposit 70% of the prescribed collected amount which would be withdrawn as per the prescribed manner.
Timely Completion, Fair Agreement to Sell etc.- There are multiple prescribed guidelines to be complied with towards allottees/consumers.
Heavy penalties – At the one side where RERA prescribe compliances, it also prescribes heavy penalties for violation of the prescribed regulations. The penalties for the violation may extend up to 10% of the project cost.
