REAL ESTATE REGULATION ACT (RERA)
Here are some of the key findings of the report:
- The number of stalled real estate projects is about 4.12 lakh dwelling units of Rs.4.08 lakh crore.
- The main reason for the stalling of these projects is lack of financial viability.
- The developers are unable to complete the projects due to lack of funds.
- The homebuyers are also facing difficulties due to the stalling of the projects.
- The government needs to take steps to revive the stalled real estate projects.
3.1. Key features
Key features of the Real Estate Regulation Act (RERA) 2016:
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Mandatory Registration: The Act mandates that all residential and commercial real estate projects with a land area of more than 500 square meters or more than eight apartments must be registered with the respective state's Real Estate Regulatory Authority (RERA).
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Disclosure of Project Details: Developers are required to provide comprehensive information about the project, including layout plans, timeline, approvals, and details of the promoter. This ensures greater transparency for prospective buyers.
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70:30 Rule: Developers are required to deposit 70% of the funds collected from buyers into a separate escrow account. This measure prevents developers from diverting funds meant for a specific project to other activities.
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Adherence to Timeline: RERA mandates that developers complete projects within the specified timeline, and delays can result in penalties. This helps protect buyers from extended project delays.
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Defects Liability: Developers are liable for any structural defects or poor workmanship in the project for a specified period after possession. Buyers can approach the developer for rectification within this period.
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Real Estate Agents: The Act also covers real estate agents, requiring them to register with RERA and adhere to certain standards of conduct and professionalism.
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Transparency in Marketing: Developers must advertise and market projects based on the details provided in the RERA registration. False or misleading advertisements are prohibited.
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Appellate Tribunals: Each state has established a Real Estate Appellate Tribunal to hear appeals against decisions of the Regulatory Authority and Adjudicating Officer.
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Dispute Resolution: The Act establishes a mechanism for dispute resolution between buyers and developers, aiming to provide quicker and more efficient solutions.
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Punitive Measures: In case of non-compliance with the provisions of the Act, penalties can be imposed on developers, promoters, and real estate agents.
