On 1st May 2017, the Government of India brought into action an act which was severely needed, in order to put an end to the malpractices carried out by the builders and property dealers. For many years property buyers had complained that most of the real estate deals were lopsided and unsupervised. Consequently, Government of India looked into it and announced RERA (Real Estate Regulation and Development Act) in March 2016. The act is meant to regulate the real estate field and all the projects under it. Now, every real estate developer has to follow certain set of guidelines. Failing to do so, buyers may file a lawsuit against the developer. With RERA now in place, it is slightly safe for the buyers to buy property. If you are buying a property now, or in the near future – that is after the implementation of RERA – here are some points you should keep in mind.
1.Registration of the Project
Before paying any amount of the final cost, it is imperative to check whether or not the project has been approved by RERA. Each project has to be approved by RERA before it can be sold, regardless of whether it is a residential or commercial project. If the project is not RERA-approved, then the developer may be liable for penalty of as high as 10% of the total cost of the project. RERA ensures that the project has been constructed while keeping certain guidelines in mind, is legal, and is safe to inhabit.
2.Background of the Developer
Since RERA is a newfound rule, it may have some loopholes, as it is with any new regulation, which a real estate developer may try to take advantage of. Therefore, the onus is on the client to also make sure at his/her own end that the developer and its project can be trusted for investment. Just because a project is approved by RERA does not mean that it can be fully trusted. A property buyer must do his/her own background check on the developer, especially the previous projects of the developer. A developer with a list full of completed projects indicates strong background, whereas one who has commenced a number of projects in the past but have not complemented many of them indicate that developer cannot be trusted for another project.
Each developer commences a project with a certain budget in mind. For obvious reasons, the budget is not rigid and the final cost involved in the completion of the project always goes higher than the budget. Many developers take loans from the bank and pre-launch project to gather the fund to complete the project. Therefore, before buying a flat into any project, make sure that the developer has the financial stability to finish a project.
4.Advertisement Prohibited without Registration
Under the RERA, each developer has to first register the project before even advertising it. The authority will provide the developer with a registration number which needs to be mentioned on all the advertisements. Therefore, if you see an advertisement without the RERA registration number, it is advisable to enquire well before considering it. Moreover, to further make sure that the registration number written on the advertisement is authentic, contact your nearest RERA regulatory office and confirm it from them.
Earlier, the developer used to advertise the total area of a flat with built-up and super built-up area included in it. As a result, the buyers would get a carpet area much less than they were promised. However, now with RERA in place, a developer can only advertise and sell on the basis of carpet area of the place.
6.No Changes without Consent
It so often happens that the developer wishes to make certain structural changes while the project is in the development phase, for many reasons. However, now the developer cannot change, add anything or make alterations in the sanctioned plan without a written consent from the RERA. This regulation by RERA is to prevent the developer form indulging in malpractices and to deliver exactly what the developer has been given permission.
Therefore, irrespective of RERA in place, a homebuyer has to keep things secure at his/her end to make sure that he/she is satisfied with the property, regardless of whether he/she buys 1-BHK or 3-BHK in Mohali, Noida, Ghaziabad, or any other part of India.
What to Look for in a Flat Post-RERA Implementation? On 1st May 2017, the Government of India brought into action an act which was severely needed, in order to put an end to the malpractices carried out by the builders and property dealers. For many years property buyers had complained that most of the real estate deals were lopsided and unsupervised. Consequently, Government of India looked into it and announ...
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