RERA and its effects on the developers

RERA stands for Real Estate Regulation Act is a buyer-friendly measure started by the government of India from 1 May 2017. This act by the government is a hot topic for the discussion and its impact on the real estate sector.

As dedicated as a buyer-friendly act, some unique features of RERA are:

Under RERA, each state will have to set up regulatory bodies as appellate tribunals to solve the disputes between buyer and developer within 120 days.

The developer will have to put 70% of the money collected from a buyer in a separate account to meet the construction cost of the project.

RERA also seeks to impose strict regulations on the promoter and ensure that construction is completed on time.

The buyer will pay only for the carpet area (area within walls). The developer can’t charge for the super built-up area, as is the practice at present.

Developers will be able to sell projects only after the necessary clearances. Under RERA, developers and agents will have to register themselves with the regulator and get all projects with more than eight apartments registered before launch.

With all the above clauses it seems that RERA is more leaned toward the buyers and provide fewer benefits to the developers. Initially, it was assumed that the developers who advertise more are a good developer. This is the reason why many honest developers are overlooked and they have to sell their projects at very low prices. Now, the wheels are turned and people can look beyond advertisements as the information will be available in a transparent manner.

HomeCapital, a new fintech company is helping the first time buyers with their down payment needs and also educating about the real estate market while the buyer is in the buying process. They have also ensured that the buyer gets what he deserves for the payment made.