Nowadays, people are curious to know about the Real Estate (Regularity & Development) Act, also known as the Real Estate Bill or RERA. We at Apna RERA took the initiative to make people aware of RERA. Our research team visited Quora, one of the best question-and-answer sites and gathered some really interesting questions asked by Quorans related to the RERA.
With the help of Real estate experts, we have come up with the answers for top five questions related to the RERA.
Note: The questions are not edited by us; it is presented as the way it was asked by Quora users.
Ans: RERA stands for Real Estate (Regularity & Development) Act. It is also known as the Real Estate Bill. This Act was passed by the Indian Parliament on March 15th, 2016 and came into force on May 1st, 2016.
The main objectives of the Act include:
As of now the act is still not implemented in all Indian states thus people are facing various problems in buying homes due to the unethical practices and immoral activities of realtors. Due to delays in the project approvals and dispute resolution, the long-standing demand of the industry and consumers is not getting fulfilled.
Once the act will be implemented in all Indian states, it will bring the much-needed transparency and accountability to place greater emphasis on implementing unambiguous deeds of doing business in the sector.
Ans: Most of the builders think that the RERA will adversely affect them, but it is not correct. The RERA aim at regulating the real estate sector and anyone either it is a real estate developer, buyer or agent, who will not adhere to the rules of the RERA, may face consequences.
Talking about the builders, in order to escalate the responsibility and accountability towards consumers, the RERA has mandated real estate developers (also known as real estate promoters) to register the project (measuring more than 500 square meters or more than eight apartments) and obtain a valid registration number before proceeding. He/she is not permitted to market, advertise or sell the units before the registration of the project. If the project is to be developed in phases, then the developers have to obtain registration for each phase separately.
The developer is required to submit all the necessary documents related to the project as prescribed by RERA. It is mandatory for a real estate developer to open an escrow account in a bank recognized by the government and must deposit 70% of the total payment received from the consumer. He/she can withdraw the money and should solely use it for the development of the said project after getting it approved from an engineer, architect or chartered accountant.
If the developer fails to comply with the directions or violates the rules prescribed by RERA or the Appellate Tribunal then, he/she may face imprisonment up to three years with a fine of up to 10% of the total estimated cost of the project in question.
Ans: Mr. Arun Jaitely, the Finance Minister of India, through his speech on the Union budget 2017 has explicitly publicized the much-needed measures to organize and develop the real estate sector in India.
Mr. Jaitely announced that 'Affordable Housing' will be given 'Infrastructure' status, which is likely to catalyse the participation of private real estate stakeholders.
As per the Union budget, 2017, the carpet area of 60 square meters will be applicable for affordable housing instead of the built up area except for four metro cities where the carpet area of 30 sq. meters (in the case of municipal limits) will be applicable. This will indirectly benefit the home buyers in non-metro cities and peripheral areas of metro cities.
Giving relief to the home sellers, the government reduced the capital gain tax period from three years to two years. This means that the person who intends to sell his house after two years of purchase, has to pay less tax for the capital gained from selling the property.
The minister also announced that the notational tax on the unsold but completed real estate unit will be charged only after 1 year. The landowner of any real estate project has to pay tax on capital gains after the completion of the project. This will encourage more landowners to start developing projects with realtors leading to the increase in property supply which will prove beneficial for the purchasers.
Ans: RERA will bring drastic changes Maharashtra's real estate sector.
RERA or Real Estate (Regulatory & Development) Act, 2016 empowers all stakeholders in real estate sector, such as consumers, developers, brokers/intermediaries and more by bringing much-needed transparency and accountability to place greater emphasis on planning and implementing unambiguous deeds of doing business in the sector.
After the implementation of RERA in Maharashtra, there will be a fast-track dispute resolution mechanism for matters related to real estate. The efficiency and transparency in real estate transactions will increase that will emit scams like Adarsh Housing society and much more. It will also promote good governance in the sector and will create investor confidence.
Ans: After the implementation of the Real Estate Bill 2016 also known as the RERA, the price of homes in India will get balanced. Let us consider two cases.
Clubbing the above two points, we can say that the price of residential properties will be balanced after the implementation of the RERA.
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Also Read : RERA - Benefits for Real Estate Developers
The Real Estate (Regulation & Development Act) popularly known as RERA came into effect on 1st May 2016 after the government of India sought to promote discipline and transparency in the real estate sector of the country.
The government of Uttar Pradesh has notified the UP Real Estate (Regulation & Development) Act (RERA) on 29 October 2016. Counting to regulate the real estate sector in the state
We all have heard a proverb “Tit for Tat” but it seems that this is not true when it comes to the RERA.