What is RERA
The government of India has enacted the Real Estate (Regulation and Development) Act 2016 and all the sections of the Act shall come into force with effect from May 1, 2017. Under this Act, Government of Gujarat established Gujarat Real Estate Regulatory Authority (GUJRERA), vide Notification No. 23 dated 8 March 2017, for regulation and promotion of real estate sector in the State of Gujarat. The key components of Real Estate (Regulation and Development) Act, 2016 are as follows:
1. Real Estate Regulatory Authority and Appellate Tribunal
2. Real Estate Projects Registration
3. Real Estate Agents Registration
4. Filing of complaints
5. Financial Discipline
7. Citizen Centricity
Why RERA Required
Why RERA Is Important?
A regulation like RERA was needed in order to revive confidence in our country’s real estate sector. It is one of the leading revenue generators in our country and it is needed some transparent government authority to keep a check on developers. RERA will provide a common ground for both buyers and developers and will reduce the risks which were faced by the people before. RERA is of extreme significance as it will be applicable to more than 76,000 companies across the country. This act mandates a number of things like registration of projects and real estate agents which have become mandatory now. A buyer will have all the rights to know every detail about a real estate project and will also have the right to get all the documents related to the project. RERA establishes a state authority which will govern both residential and commercial real estate transactions. RERA will ensure timely delivery of the project which is a big sigh of relief to home buyers. RERA will guarantee more precision between the developers and buyers thereby ensuring transparency.
RERA’s Impact On The Real Estate
- All brokers are to be registered with state-level real estate regulatory authority.
- Brokers in the unorganized sector need to get a license or they are out of the market.
- It is mandatory to make the code of conduct for the agents and they have to make all their transactions official thereby curbing the unfair trade practices.
- Cost of developers will rise as now onward sale can only happen after the registration
RERA will also affect the organized real estate sector, for example, a retail investor who invests in an under construction project for assured return will now have the detailed information about the financial strength of the developer offering the assured return. This Act empowers the regulators to find and detain the defaulters and the detainment can go up to a period of three years.
Benefits That RERA will have on Investments in Real Estate:
- Simplified Procedures: RERA will make it mandatory for every state and union territory to have online registrations. With documentation processes made easy, consumers will benefit and save time.
- Transparency: With the RERA website going live, consumers can track the developments of the projects from any corner of the world. All plan layouts and documents will be uploaded to the site, giving them no reason to worry about their investments.
- Timely Possessions: The biggest worry customers face while investing in real estate properties in India is the fear of delayed possessions. RERA will ensure that they will not have to face any possession-related problems.
- Trustworthy: A strong and authoritative implementation of RERA will build a strong trustworthy relationship between consumers and the developers, thereby encouraging more investments.
- Grievance Redressal: With RERA coming into effect, consumers will have an official authority to address their grievances and complaints associated with their real estate investments. This will enable them to act promptly and take better decisions.
A healthy policy change is a big boost for a growing economy. And with RERA all set to transform the realty sector, it can be said that consumers will benefit by investing in a rich market like India, which is a growing market for maximizing returns.