Introduction
The Indian real estate sector has witnessed a significant transformation in recent years, with the introduction of the Real Estate (Regulation and Development) Act, or RERA. This landmark legislation has brought about a new era of transparency, accountability, and buyer protection in the industry. In this article, we will explore the rise of RERA-approved projects and why buyers should check for RERA approval before investing in a property.
What is RERA?
RERA, or the Real Estate (Regulation and Development) Act, is a federal law that regulates the real estate industry in India. The law was enacted in 2016 to promote transparency, accountability, and buyer protection in the industry. RERA requires developers to register their projects with the relevant state or union territory’s RERA authority before selling or advertising their properties.
Benefits of RERA-Approved Projects
RERA-approved projects offer several benefits to buyers, including:
1. Transparency and Accountability: RERA mandates developers to disclose project details, including construction plans, timelines, and payment schedules, on the RERA website.
2. Financial Safety: Builders deposit 70% of project funds into an escrow account, ensuring that money is used only for construction and project-related costs.
3. Protection Against Delays: Developers are accountable for project delivery and quality, with penalties for unjustified delays. Buyers are entitled to compensation for delays.
4. Increased Market Value: RERA-approved flats hold higher market value due to adherence to quality standards.
Key Factors to Check in a RERA-Approved Project
When investing in a RERA-approved project, buyers should check the following key factors:
1. RERA Registration Number: Verify the project’s registration number on the RERA website.
2. Developer’s Past Projects and Reputation: Research the developer’s credibility and customer reviews.
3. Project Delivery Timeline: Check the project’s completion timeline and milestones.
4. Escrow Account Details: Verify the escrow account details to ensure financial transparency.
5. Approved Layout and Building Plan: Check the approved layout and building plan to ensure compliance with regulations.
Why Choose RERA-Approved Projects?
RERA-approved projects offer several advantages over non-approved projects, including:
1. Minimized Risk: RERA-approved projects comply with legal requirements, minimizing the risk of buying into fraudulent or incomplete projects.
2. Boosted Market Credibility: RERA approval increases the credibility and market reputation of developers.
3. Improved Return Potential: RERA-approved projects offer higher resale value and better rental potential due to adherence to quality standards.
4. Fair Pricing: RERA ensures fair pricing, preventing hidden costs and ensuring that buyers pay a fair price.
Impact of RERA on the Indian Real Estate Sector
The introduction of RERA has had a significant impact on the Indian real estate sector, leading to:
1. Increased Transparency: RERA has increased transparency in the industry, making it easier for buyers to make informed decisions.
2. Improved Accountability: RERA has improved accountability in the industry, holding developers responsible for project delivery and quality.
3. Enhanced Buyer Protection: RERA has enhanced buyer protection, providing buyers with a safeguard against fraudulent practices and project delays.
4. Increased Investor Confidence: RERA has increased investor confidence in the industry, leading to increased investment in RERA-approved projects.
How to Check RERA Approval?
Every state in India has its own RERA website where buyers can search for registered projects and verify their details. Prospective investors should:
- Visit the official RERA portal of their state
- Search for the project by name or registration number
- Verify the project details, approvals, and completion timeline
- Check developer credentials and past records
This simple step can protect buyers from potential fraud or legal complications.
Dispute Resolution
RERA provides a mechanism for dispute resolution, including:
1. RERA authorities: RERA authorities are responsible for resolving disputes related to RERA-approved projects.
2. Arbitration: Disputes may be resolved through arbitration, as specified in the RERA agreement.
3. Court proceedings: Disputes may be resolved through court proceedings, if necessary.
Cases-:
Rajendra Agrawal v. Mahima Real Estate Pvt Ltd: This case established that developers are liable for delays in project completion and must compensate homebuyers accordingly.
Supreme Court Seeks Responses From States And Union Territories: The court has sought responses from states and union territories that have not established RERA authorities or appellate tribunals, highlighting the need. for uniform implementation.
– Everlike Real Estate and Developers Pvt. Ltd Vs. Mr. Mohit Goyal: The National Company Law Appellate Tribunal (NCLAT) ruled that the distinction between genuine and speculative homebuyers is relevant only at the stage of Corporate Insolvency Resolution Process (CIRP) under Section 7 of the Insolvency and Bankruptcy Code (IBC)
Conclusion
The rise of RERA-approved projects has revolutionized the Indian real estate sector, offering buyers a safeguard against fraudulent practices and project delays. By understanding the benefits of RERA-approved projects and checking for RERA approval before investing, buyers can make informed decisions and invest in properties with confidence. As the Indian real estate sector continues to evolve, RERA-approved projects are likely to play a significant role in shaping the industry’s future.
CONTRIBUTED BY: TANISHA ARORA(INTERN)