One of the chief concerns for a home buyer while purchasing a flat that is under construction or in a newly constructed building is that the developer can cheat them by not completing the project. There are hundreds and hundreds of such projects in the city and this is one big problem that new home buyers face in the present market condition. But the government has finally come to their aid and has implemented RERA, which will help all new home buyers rest assured that they get their moneys’ worth and that too in the time period that has been promised to them.
So, what is RERA? RERA stands for Real Estate (Regulation and Development) Act. This act was implemented on May 1st 2017 and as per this act all developers of both residential and commercial properties need to register their project with the Real Estate Regulation Authority. This has to be done within three months of the implementation of the Act. On failing to do so the developer faces a penalty which amounts up to 10 percent of the cost of the project or even imprisonment. Without registration, the developer cannot sell or advertise the project or invite potential buyers to purchase any units. This act is a game changer for home buyers as most of its rules and regulation are in their favour.
There is good news for home loan seekers too. As per this act if there is a delay in the construction of under construction property the burden of paying monthly interest on your housing loan during that period falls on the developer. Under RERA, a separate account has to be used to deposit 70% of the money collected for the project’s construction, and developers can draw from it only for construction purposes.
RERA India is all about transparency between the buyer and the developer. The RERA act makes it mandatory for developers to give all details of the project to the buyer such as the cost of land, development agreement, cost of construction, sanctioned plans, covered parking lots, and open spaces, among others. These details should all be available to buyers online, the developer must also provide a time frame and a phase wise plan to the buyer.
A new home owner can also seek free repairs if he or she finds any structural damage within five years of taking possession form the developer. The developer then has to carry out the repair work without charging any of his tenants. Read more here - RERA to boost demand for affordable housing