The Real Estate (Regulation and Development) Act, 2016 (RERA) is a significant piece of legislation in India that aims to protect the interests of homebuyers and promote transparency in the real estate sector. Here’s how RERA safeguards the interests of buyers:
- Registration of projects: Under RERA, developers are required to register their real estate projects with the respective state’s RERA authority before advertising, marketing, or selling any property. This ensures that only genuine and approved projects are offered to buyers.
- Disclosure of project details: Developers are obligated to provide comprehensive information about the project, such as layout plans, carpet area, approvals, timeline, and completion date. This transparency helps buyers make informed decisions.
- Carpet area basis: RERA mandates that property prices are quoted based on the carpet area (the actual usable area within the walls). This prevents developers from inflating prices based on super built-up areas.
- Escrow account: RERA requires developers to deposit 70% of the funds received from buyers into a separate escrow account. This measure ensures that the funds are used solely for the construction and development of the specific project.
- Delay compensation: If a developer fails to deliver the project within the agreed-upon timeframe, buyers are entitled to receive compensation for the delay. This discourages developers from extending project timelines without valid reasons.
- After-sales service: Developers are responsible for providing necessary support and maintenance services for a specified period after the possession of the property.
- Structural defect liability: Developers are accountable for any structural defects that may emerge within a specific period after the possession of the property. Buyers can claim remedies for such defects without additional charges.
- Right to information: RERA provides buyers the right to access all information related to the project, including documents and plans submitted by the developer to the regulatory authority.
- Grievance redressal: RERA establishes state-level Real Estate Regulatory Authorities (RERAs) and Real Estate Appellate Tribunals (REATs) to address buyer complaints and disputes in a time-bound manner.
- Prohibition on false advertising: RERA prohibits developers from making false or misleading claims in advertisements and promotional materials.
- Agent regulation: The Act also covers real estate agents and mandates their registration with RERA. It ensures that agents adhere to a code of conduct and act in the best interests of the buyers.
Overall, RERA instills transparency, accountability, and consumer protection in the real estate sector, making it more buyer-friendly and reliable. It empowers buyers to make well-informed decisions and protects them from unfair practices and delays.