Everything about the Real Estate Regulatory Authority Act.
The main objective of RERA is to advance investments and protect the interest of home buyers in the real estate industry. Under the real estate regulation act, central and state governments are to disclose the new rule within a judicial period of six months.
What is RERA Act?
RERA stands for Real Estate Regulatory Authority. The act came into motion on 1st May 2017. It aims to regulate and promote the real estate sector and ensure sales efficiently and transparently. The real estate regulation act wants to build a swift mechanism for dispute redressal and redrafting council to hear requests from the choices, bearings or orders of the Real estate regulatory authority and the mediating official and for issues associated with it or coincidental to it.
RERA Act frequently used terms and their definitions:
- What is an agreement for sale?
- It is an agreement entered between the promoter and the allottee.
- Who is an allottee?
- In liaison with real estate projects, the person to whom a plot, apartment or building has been allotted, sold (whether as freehold or leasehold) or generally transferred by the promoter and incorporates the individual who finally acquires the said allotment through sale, transfer or otherwise. It does not include a person to whom the plot, apartment or building is given on rent.
- What is a carpet area?
- The carpet area is the net usable floor area of the apartment, excluding the area covered by the external walls, areas under services shafts, exclusive balcony or verandah and exclusive open terrace areas but includes the area enclosed by the internal partition walls of the apartment.
- What is a commencement certificate?
- It means the construction permit issued by the competent authority to allow or permit the promoter to start advancement work on immovable property, according to the endorsed plan.
- What is a completion certificate?
- It is a certificate given by the competent authority certifying that the project is as per the sanctioned layout plan and specifications.
- What is an Occupancy certificate?
- It is a certificate given by the designated authority permitting the occupation of any building, as provided under local laws, which has provisions for infrastructure such as water, sanitation and electricity.
Registration of real estate projects.
No promoter can advertise, market, sell, or invite persons in any manner to purchase a plot, apartment or building in any real estate project without registering the project with the Real Estate Regulatory Authority under this act.
Every promoter shall make an application to the authority for the registration of the projects. The promoter shall disclose the following documents within the application;
- Detail of the enterprise.
- Brief details of the project launched in the past five years, whether already completed or being developed.
- An authentic copy of the approvals and commencement certificate from the appropriate authority.
- Sanctioned plan, layout plan and detailed specification of the project.
- The proposed facilities to be provided thereby, including fire fighting facilities, water facilities, emergency evacuation and renewable energy
- Location details of the project.
- Land details of the project, along with the longitude and latitude with the endpoints of the project.
- Proforma of the documents of the proposed deeds to be signed with the allottees.
- Type of apartments in the project with the carpet area details.
- The names and addresses of the real estate agents if proposed in the project.
The promoter has to specify the completion time of the project. Seventy per cent of the sum received for the project from the buyers, every once in a while, shall be deposited in a different account maintained by a scheduled bank to take care of the development and land cost and utilize it exclusively for that purpose.
The grant of registration is subject to the rules and regulations of the act and provided with a registration no and a login id and password to the promoter for accessing the RERA website and filling in the required details of the proposed project.
Functions & duties a promoter needs to abide by according to the RERA Act.
- The advertisement published by the promoter should mention the website of the Real Estate Regulatory Authority, wherein all the details related to the project have been submitted.
- The promoter shall be responsible for the completion and occupancy certificate.
- They are responsible for the lease certificate where the real estate project is being developed on leasehold land, determining the time of the lease and affirming that all duties and charges concerning the
- leasehold land has been paid, and make the lease certificate accessible to the association of allottees.
- Be answerable for giving and keeping up with the fundamental administrations, on reasonable charges, till the taking over of the maintenance of the project by the association of the allottees.
- Enable the formation of an association or society or cooperative society.
- The promoter must pay all the costs until he transfers the physical possession of the project to the allottee or the group of allottees.
Registration of real estate agents.
A real estate agent cannot facilitate the sale of a project without being registered under the RERA Act. The real estate agent has to apply with the Real Estate Regulatory Authority.
The RERA authority shall grant a registration number within a stipulated time if everything is in line with the Real estate regulation act. The registration number has to be quoted by every real estate agent in every sale done by him.
Every registration number is valid for a specific period and shall be renewable on payment of the fee as prescribed.
Functions of Real Estate agents.
- Only facilitate the sale of real estate projects with a RERA registration number.
- Not involved in unfair trade practices.
- Do not make false or misleading representations relating to the services.
- Being transparent with the home buyer relating to all the information related to the project.
RERA has been evolving since its inception and more reforms are needed, but the basic tenets that the home buyer should get empowered with will not change.