How RERA Act is impacting real estate business By Avani Mishra - December 7, 2018 Last Updated at: Dec 03, 2020 1571 How RERA Act is impacting real estate business The Indian government recently enacted the real estate act. This act requires developers to register their projects under the RERA Act. As soon as this act came into effect, many buyers had numerous doubts regarding real estate transactions as this was helping the developers to a great extent. Here, you will get to know more about the RERA Act. The government of India enacted the real estate act on 26th March 2016 and it came into operation from May 1st, 2017. Developers were given time until July 2017 for their projects to be registered under the RERA. Central and State Governments are required to notify their own rules under the act on the basis of the rules framed under the central act. Explore our legal help services to protect your intellectual property, secure funding from Venture Capitalists & comply with the many regulations of the MCA information and resources to help you through your end to end business requirement. Register a Company PF Registration MSME Registration Income Tax Return FSSAI registration Trademark Registration ESI Registration ISO certification Patent Filing in india Why RERA For a long time, the buyers had their own doubts about real estate transactions which were heavily in favor of the developers. RERA and the governments model code aimed to create an equal and fair transaction between the seller and the buyer of properties, especially in the primary market. RERA is hoped to make real estate purchase simpler by bringing in clarity and transparency in accounts. RERA will give the Indian real estate industry its first regulator, thus it makes it mandatory for all states and union territory to frame the rules that will govern the functioning of the regulator. Get FREE legal advice now ADVANTAGES Some of the important compliances are informing allottees about any minor addition or alteration. Consent of 2/3rd allottees about any other addition or alteration, no launch or advertisement must be made before registering in the RERA. Sharing information, project plan, layout, government approvals, land title status, subcontractors add to the advantage of the buyers. The most positive aspect of this act is that it provides a legal regime for the purchase of flats, apartments, etc. Key highlights of the act are the establishment of the regulatory authority According to this every real estate project which exceeds 500 sq.mts or more than 8 apartments must be registered under their respective states RERA act The most primary reasons for delay of projects was that funds collected from one project would invariably be diverted to fund new different projects. To prevent this all the projects should have a separate reserve account and fund in this account can be used only for construction expenses and will be required to be certified by a professional Under this act, the buyers will be able to monitor the progress of the project on the RERA website since the promoters have to update regarding the progress Promoters are required to create a warranty on his right title and interest on the land which can be used later against him by the home buyer if there is any title defect. To ensure that there is no violation of the act monetary penalty up to ten percent has been levied against violators and also imprisonment in some cases Thus initially a lot of work has to be done to get the existing and new project registered. With the advent of RERA specialized forums such as the state, real estate regulatory authority will help to resolve disputes pertaining to home buying and the aggrieved party will have no recourse to other consumer forums and civil courts on such matters. RERA is used for fast-tracking dispute resolution, it acts as a dispute resolution system. The rules of RERA are different in different states and union territories so the real estate dealers must abide by their state rules. To put it in a nutshell RERA enhances quality, the confidence of investors, attracts higher investments and provides a regulated environment. As a result of the implementation of the RERA Act, there could be a lot of work when it comes to registering the existing and new projects. However, there are many forums that will help you regarding the same and resolve disputes that exist in home buying. By now, you would have understood that RERA is meant for the faster tacking of dispute resolution.