Decoding India's Real Estate Regulatory Authority (RERA) for Homebuyers

Decoding India's Real Estate Regulatory Authority (RERA) for Homebuyers

Real estate investments are one of the biggest financial decisions an individual makes in their lifetime. While investing in the real estate market is a great way to build wealth, it comes with its own set of uncertainties, especially in a country like India. Therefore, the government of India introduced The Real Estate (Regulation and Development) Act, 2016, commonly known as RERA to regulate the Indian real estate sector. Here, we will decode RERA for homebuyers.

What is RERA?

RERA stands for The Real Estate (Regulation and Development) Act, 2016, and it came into force on May 1, 2017, by the Ministry of housing and urban affairs. RERA aims to enhance transparency, accountability, and regulatory oversight of the real estate sector in India, protecting the interest of homebuyers, and promoting the growth of the sector.

Why was RERA introduced?

Before the introduction of RERA, the real estate sector in India was unorganized, unregulated, and plagued by corruption, malpractices, and delays. Homebuyers were frequently cheated due to the lack of transparency and regulation in the sector. Therefore, the government of India took a bold step to introduce RERA to eliminate unscrupulous practices by bringing in transparency and accountability in the sector.

How can RERA protect homebuyers?

RERA provides significant benefits to homebuyers by safeguarding their interests. It brings in transparency in the system by mandating developers to register their projects with the authorities and make regular disclosures about the project's progress. It also requires developers to submit all relevant legal documents to ensure that the project is legal and free from any encumbrances.

RERA ensures that homebuyers get timely delivery of their homes, and the possession date is mentioned upfront in the agreement. Developers are required to complete their projects within the timeline and provide compensation for delayed possession.

RERA has also introduced strict penalties for developers who violate any of its provisions. Developers are liable to pay heavy fines if they do not comply with the regulations or make any false claims or promises.

What are the other key features of RERA?

Apart from protecting homebuyers' interests, RERA has several other features that aim to enhance the sector's growth. Some of these key features are:

- It mandates developers to maintain an escrow account to ensure that the project's funds are not diverted to other projects.

- It has established RERA authorities in every state and union territory to ensure the proper implementation of the act.

- It enables homebuyers to file complaints against developers for any grievance regarding the project.

- It requires developers to inform buyers about the carpet area of the property, instead of the super built-up area, which can be misleading.

- It mandates the promoter/developer to obtain necessary approvals before the launch of the project.

In conclusion, RERA has been a game-changer for the Indian real estate sector, providing adequate protection to homebuyers and regulating the sector's growth. As a homebuyer, it is crucial to be aware of these regulations and use them to your advantage. You can check the RERA website or consult with a lawyer to ensure that your investment is secure and protected.