All about Real Estate Regulatory Authority (RERA Act)

Buying real estate was a nightmare before 2016. Investors were at the mercy of the promoters, but everything changed after 2016

Buyers and sellers have their own interest at heart. When negotiating, each of them looks for the best deal for themselves, which usually comes at the cost of the other. This problem crippled the real estate sector for a long time, until the Real Estate Regulatory Authority (RERA) was formed in 2016. The move proved a masterstroke, as demand for properties and home loans increased drastically thereafter. But what is the RERA?

What is the RERA?

The RERA was founded as part of the Real Estate (Regulation and Development) Act, 2016. The act was passed to address the challenges present in the realty sector. Its goal was to safeguard real estate buyers while increasing investment in the sector. It also helps banks by increasing the demand for home loans.

What is the RERA act?

Both houses of the Parliament passed the RERA bill in 2016. It came into effect on May 1, 2016, and ensures buyers do not suffer when buying a property. The RERA approval usually entails RERA registration. To register a project with the authority, every builder must adhere to a few standards. It includes approvals, land titles, and insurance.

What is RERA registration?

RERA registration is a process by which properties under sale are listed in the RERA domain. RERA registration is a state-by-state process, so it differs from one state to another. The application can be completed on the official webpage of the state where the registration is sought. The promoters and real estate brokers must submit the paperwork, as well as a request for registration, to their individual states' regulating authorities.

How does the RERA benefit buyers?

The RERA is especially useful for buyers. Some of its benefits include:

Ownership of the property on schedule

Promoters' false claims of construction completion and delivery were a major flaw in the realty sector. It resulted in tremendous financial anxieties and scepticism among buyers. But if promoters file under the RERA, they must submit an expected completion date for the project. Inability to do so results in severe fines.

The project's exact details

The promoter must offer comprehensive and precise project information, such as the project's current stage of construction, facilities provided, and other important details or ongoing projects, which cannot be changed later.

Guaranteed license clearances

Before the RERA, project promoters would never acquire the necessary government permits and clearances, because of which projects would get delayed. However, prior to selling even a sole unit, promoters authorised under the RERA must have the licences in place.

Repairing flaws

Following the buyer's purchase, it is the promoter's obligation to correct any defects or inadequacies.

Limited advertising

Promoters can market their properties only after obtaining the proper approvals from the RERA. The registration ID must be included in the advertisement.

Payment of the reservation fee

The 10% booking fee must be paid only after the terms of the sale have been registered.

The RERA helps build faith in the realty sector, which ensures continued investments. IDFC FIRST Bank can, meanwhile, help you with funding your real estate portfolio. Home loan interest rates at IDFC FIRST Bank are among the lowest in the market, which helps you save money and supplement your portfolio at the same time. Even after getting the home loan, you can explore other products at IDFC FIRST Bank and fund your requirement.

Disclaimer

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