RERA Law

RERA stands for Real Estate (Regulation and Development) Act, which was enacted in India in 2016. It aims to regulate and promote transparency in the real estate sector, protect the interests of homebuyers, and establish a mechanism for the speedy resolution of disputes related to real estate transactions. Here are key aspects and provisions of the RERA law:

Key Provisions of RERA

1. Regulatory Authority : 

 

  • Formation: Each state and union territory in India has established a Real Estate Regulatory Authority (RERA) to oversee the implementation of the Act.
  • Functions: The authority ensures compliance with RERA provisions by developers, promotes transparency, and protects the interests of buyers.

2. Registration of Real Estate Projects : 

 

  • Mandatory Requirement: Developers must register their real estate projects with the respective state RERA before advertising or selling units.
  • Disclosure Requirements: Detailed information about the project, including land status, approvals, timeline for completion, and financial details, must be disclosed to buyers through the RERA portal.

3. Obligations of Promoters : 

 

  • Adherence to Project Specifications: Developers must adhere to approved plans, use appropriate construction materials, and complete projects on time.
  • Deposits in Escrow Accounts: A specified percentage of funds received from buyers must be deposited in a separate escrow account to cover construction costs.

4. Rights and Duties of Allottees : 

 

  • Information Access: Homebuyers have the right to obtain information about the project's progress, construction stages, and other relevant details.
  • Timely Possession: Developers are obligated to hand over possession of the property to buyers as per the agreed timelines specified in the sale agreement.

5. Penalties and Adjudication : 

 

  • Non-Compliance: Developers failing to comply with RERA provisions may face penalties or imprisonment.
  • Dispute Resolution: RERA authorities have the jurisdiction to adjudicate disputes between developers and buyers, ensuring quick resolution through conciliation or arbitration.

6. Role of Real Estate Appellate Tribunal : 

 

Appeals: Parties dissatisfied with RERA decisions can appeal to the Real Estate Appellate Tribunal established by each state or union territory.

7. Promotion of Transparency and Accountability : 

 

  • Promotion: The Act promotes transparency in real estate transactions by ensuring clear communication, standardization of sale agreements, and adherence to ethical business practices.
  • Accountability: Developers are accountable for their commitments to homebuyers and face consequences for any breaches of agreement or failure to deliver on promises.

Impact and Challenges

1. Impact on Real Estate Sector : 

 

  • Consumer Confidence: Enhances buyer confidence by providing a regulatory framework that protects their interests and ensures transparency.
  • Industry Compliance: Encourages developers to streamline operations, adhere to timelines, and maintain financial discipline.

2. Challenges : 

 

  • Implementation Delays: Challenges in setting up effective RERA authorities and portals across all states and union territories.
  • Compliance Burden: Initial compliance costs and adjustments required by developers to align with RERA provisions.

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