RERA
Real Estate Regulatory Authority
Real Estate Regulatory Authority (RERA)
As India continues to consolidate its position as a major player in the international market, various industries and businesses have seen tremendous growth, which has further contributed to the surge in real estate prices.
To contain the rising real estate prices and safeguard the interest of home buyers, the government established RERA or Real Estate (Regulation and Development) Act, 2016, which regulates and tracks the real estate sector in all the states.
What is RERA and its importance?
RERA provides a middle ground for both property buyers and developers and helps in reducing the risks faced by people before this act .The purpose of the RERA Act, 2016, is to protect the homebuyer and increase the investments in the real estate industry. The RERA law is implemented in all the states to regulate the real estate sector.The purpose of the RERA Act, 2016, is to protect the homebuyer and increase the investments in the real estate industry. The RERA law is implemented in all the states to regulate the real estate sector.
Benefits That RERA will have on Investments in Real Estate
Transparency and Information Disclosure
RERA mandates developers to provide accurate and detailed information about their projects on the regulatory authority's website. This transparency helps investors make informed decisions based on reliable information.
Reduced Project Delays
RERA's provisions for timely project completion and possession are expected to reduce the instances of project delays. This is crucial for investors as delayed projects can lead to financial losses and decreased returns on investment.
Risk Mitigation
RERA introduces regulations to safeguard the interests of investors by requiring developers to deposit a significant portion of the project funds into an escrow account. This helps mitigate the risk of fund diversion and ensures that the money is used for the specific project's development.
Protection Against Unfair Practices
The Act aims to protect investors from unfair practices by developers. With strict regulations on advertising, pre-launch sales, and advance payments, investors are less likely to face issues such as misleading information or financial losses due to non-compliance.
Resolution of Disputes
The establishment of a regulatory authority under RERA provides a platform for the resolution of disputes between developers and investors. This can result in quicker and more efficient resolution mechanisms, reducing the need for prolonged legal battles.
Professionalism in Real Estate Services
RERA mandates that real estate agents must register with the regulatory authority. This encourages professionalism in the real estate sector, providing investors with qualified professionals to assist them in property transactions.
Increased Investor Confidence
The overall impact of RERA in bringing transparency, accountability, and fairness to the real estate sector is expected to increase investor confidence. This, in turn, may attract more investments, fostering a healthier and more robust real estate market.
Quality Construction and Defects Liability
RERA introduces a defects liability period during which the developer is responsible for addressing any structural defects or poor workmanship. This ensures that investors receive properties of a certain quality, reducing the risk of additional expenses for repairs.
Enhanced Accountability
RERA holds developers accountable for the commitments made during the sale of properties. This includes specifications, project timelines, and quality standards. Investors can seek legal remedies if developers fail to fulfill their obligations.