RERA is aimed at protecting the interests of buyers in the real
estate sector and establishing aims to protect buyers' interests in
the real estate sector and establish rating mechanism for speedy
dispute redressal. It is an act to create a mechanism that
effectively regulates and addresses issues like project delivery
delays, property pricing, quality of construction, title, and other
changes; in an efficient and transparent manner, as set out below:{' '}
Delay in delivery of possession: The developers who default in
delivery of possession will be required to pay an interest rate of
2% above State Bank of India's lending rate to the home buyers. This
is aside the possibility of imprisonment of up to three years.{' '}
Developers will not be able to charge for the excess area: Under
RERA, ‘carpet area’ has specifically been defined. The selling of
property based on super built up area has been prohibited and can
only be sold based on the carpet area. Additionally, the developer
will also require the consent of two-thirds of the buyers in a
project before changing the project's design or any other structure.{' '}
Construction Quality: The quality of the construction has been a
concern for many buyers. Under RERA, any structural defect that
takes place to the property for up to five years from the date of
handing over possession will have to be repaired by the developer.{' '}
Developers will not be able to use the money paid by flat purchasers
for some other project: Under RERA, the developer will be required
to transfer 70% of the money received from buyers to an escrow
account. Post which, the money will be withdrawn as per the stage of
the construction, that will be approved by architect, engineer, and
chartered accountant of the developer.
Grievance redressal forum: Under RERA, regulatory bodies and
appellate tribunals will be set up in each state to solve
builder-buyer disputes. Any person aggrieved by any direction can
expect a resolution from the appellate within 120 days (about 4
months).
Clearances required before selling: The developers and agents will
have to register themselves with the regulator, disclose every
detail about the project and will be able to sell projects only
after the necessary clearances have been attained.
No more false promotions: Under RERA each advertisement has to carry
the RERA registration number, and all the promotions and
advertisements have to be completely honest without any false
commitments. Developers cannot advertise a project without obtaining
approval from RERA for the project.
