RERA - Better Realty Operations Assured

Adarsh Narahari, Secretary, CREDAI The Real Estate (Regulation and Development) Act 2016 was deliberated for a number of years before it was passed and came into force on May 1st 2016. It took between 6 months to more than a year for the rules to be formed by various states.

Initially there was a lot of uncertainty among customers and developers which is typical when a new act or rules are passed as significant as this one. However, this has been put to ease with time and there a noticeable increase in sales and the confidence level of customers, especially in the last few months. So how does RERA Benefit the Customer?

Assurance of Timely Delivery: With RERA mandating that 70% of the collection be placed in a designated account and kept compulsorily for project
expenses only, each project will be self-sustaining. Developers need to commit a timeline to deliver the product or face still penalties and severe liabilities.

Transparency in Business: Now each developer has to upload all details of the project such as plan sanctions, title reports, carpet area details, floor plans and various other project relate material on the website of the authority. The times line for delivery and specifications of materials and finishes also need to be displayed on the website. This ensures a high level of transparency in the business and improved customer confidence. Most importantly Developers are not allowed to market/sell any project before registering with the RERA authority

Quicker Dispute Resolution: The RERA has mandated the creation of a dedicated committee and tribunal for the quick resolution of disputes. Specialized forums such as the State Real Estate Regulatory Authority as well as the Real Estate Appellate Tribunal, are established for the resolution of disputes related to home purchases

Better Quality of Developers: Fly by night operators will find it difficult to sustain. There will be a lot of compliance coming into the business which will lead to better quality of people and professional work ethics. Developers will get more organised and ramp to serve their customers in this new norm. This will lead to increase in home prices with better quality projects being delivered faster.

RERA has come-in with a promise to bring change to the entire real estate sector. If effectively implemented in various states this landmark act will certainly alter the real estate landscape of the country