The Real Estate (Regulation and Development) Act, 2016 (RERA) is a landmark legislation enacted by the Parliament of India to regulate and promote transparency in the real estate sector.
Every builder followed different practices and structured the builder-buyer agreement in such a manner that is in favor of the builder. A person who invested his life savings in buying a property had very limited rights.
The RERA Act was introduced to protect and shield the interests of property buyers by ensuring that their investments were not misused by developers or builders for buying homes.
What is RERA?
Introduced in 2016, RERA stands for Real Estate Regulations Act, and to shields the profits of the home buyers.
RERA’s main aim is to deliver support to the buyers from the unethical practices of unethical builders.
RERA implies certain criteria for the building and development of real estate to ensure transparency in transactions of the real estate sector.
It proposes all builders/ developers follow established rules and regulations that ensure numerous rights to the home buyers Apartments in Hyderabad .
Besides, the RERA Act also states the nature of a Real Estate Authority and an appellate tribunal ( a special court or committee formed to reconsider a decision made by another court or committee) for each state.
In the event of any fraud done by the builder/developer, the home buyer can likewise file a charge to the authority.
10 Significant Advantages of RERA Act are as follows
RERA has introduced a plethora of benefits for homebuyers, ensuring fairness and protection in their property transactions. Here are some of the key advantages:
- Standardized Carpet Area Calculation: RERA has standardized the formula for calculating carpet area, ensuring that buyers are not misled by inflated figures. The carpet area now excludes areas like balconies, verandahs, and common areas, providing a more accurate representation of the usable space.
- Reduced Risk of Builder Bankruptcy: RERA mandates that 70% of the funds collected from buyers be deposited in a separate escrow account. This ensures that builders cannot divert funds meant for one project to another, minimizing the risk of project delays or abandonment due to financial mismanagement.
- Right of the Buyer in case of False Promises: If a builder fails to fulfill any commitments made in the project prospectus, the buyer has the right to withdraw from the project and receive a full refund, along with interest.
- Advance Payment Limitations: RERA restricts builders from demanding more than 10% of the property value as an advance payment. This protects buyers from being overburdened by large upfront payments.
- Rectification of Defects after Possession: Builders are liable for rectifying any structural defects or flaws in workmanship, quality, equipment, or services discovered within five years of taking possession. If the builder fails to do so, the buyer can claim compensation.
- Compensation for Delays in Possession: If a project is not completed and possession is not handed over on the scheduled date, buyers can either withdraw from the project and receive a full refund with interest or opt for compensation for the delay.
- Compensation for Faulty Title: Buyers have the right to claim compensation if the property title is found to be defective, even after taking possession. There is no time limit for raising such claims.
- Right to Information: RERA mandates that builders provide buyers with complete and accurate information about the project, including layout plans, construction schedules, and stage-wise completion status.
- Grievance Redressal Mechanism: RERA establishes a robust grievance redressal mechanism for addressing buyer complaints. Homebuyers can file complaints with the RERA authority, which has the power to resolve disputes and award compensation.
- Time-Bound Resolution of Disputes: The Appellate Tribunal, established under RERA, is empowered to resolve real estate disputes within a timeframe of 60 days.
Conclusion
RERA has transformed the real estate landscape in India, empowering homebuyers with greater transparency, accountability, and protection. By introducing standardized norms, establishing a grievance redressal mechanism, and empowering buyers with legal rights, RERA has made the dream of homeownership more attainable and secure. For aspiring homeowners, understanding and utilizing the provisions of RERA is crucial for making informed decisions and safeguarding their investments.
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