Real Estate (Regulation and Development) Act, 2016 which was cleared by parliament last year in March has become operational from Ist May, 2017. As soon as the Real Estate Regulation Act got cleared by parliament in last year, the states became liable to notify the realty rules and set up RERA by 30th April, 2016.
RERA Punjab is simply a landmark realty law formed with the purpose of protecting home buyers from unethical real estate developers. In short, the act aims to bring clarity and implement fair practices to protect the interests of buyers and impose penalties on culpable builders.
According to RERA, now each state and union territory will have its own regulator and set of rules to administer the functioning of regulator. Though the rules were drafted for many states including National Capital but among 32 states, only 13 states notified the rules. The states which notified the rules are:
- Uttar Pradesh
- Madhya Pradesh
- Andhra Pradesh
Notably, Madhyapradesh is the only state to set up RERA while other states have set up interim regulators.
Well, there is lot more to the story. Let’s take a look at the main highlights of RERA Act, 2017.
(RERA) became operational! NOW WHAT?
Main Highlights of Real Estate Regulation Act, 2017
All the builders which undertake the project wherein the land exceeds 500 square metre have to register with RERA. It has to be done before the launch and advertising of the project. Developers can register till July 31st. In case, the real estate developer fails to do so, he has to undergo a maximum imprisonment of 3 years or fine of up to 10% of the total project cost.
Real estate developers have to submit as well as upload all the details of project. It includes approved timeline, layout plan, cost, and the sale agreement. It is only after fulfilling this disclosure clause that a developer would be able to advertise his project to potential buyers.
- Real Estate Appellate Tribunals have to be set up in every state.
- In case of grievances, the consumer can go to the real estate regulator for redressal.
- To meet the construction cost of the project, real estate developers have to put 50% of the money collected from a buyer in a separate account.
- Real Estate Regulation Act is supposed to weed out fly-by-night operators from the sector and channelise investment into it.
- Builders will also benefit since the law has penal provisions for allottees who do not pay dues on time. Apart from this, builder can also approach the regulator if there is any issue with the buyer.
Real Estate Regulation Act directs that developers can’t get more than 10 per cent of the property’s cost as an advanced payment booking amount before a registered sale agreement is signed.