17 April, 2023
4 mins read
It’s been more than six years since the Real Estate (Regulation and Development) Act was implemented in India in May 2016. When this Act was launched, it brought great relief to homebuyers across the country, who were apprehensive after hearing about multiple real estate scams and the delayed delivery of projects. At that time, there was a dire need for a robust regulatory mechanism that could protect the rights of homebuyers and investors and keep their faith in the real estate industry intact. After the RERA Act was enacted, a Real Estate Regulatory Authority was set up in various Indian states to eradicate project delays and control property fraud. This article explores how the implementation of the RERA Act has revolutionised the Indian real estate industry and has helped trustworthy builders in enhancing their credibility.
The Indian Government has made it mandatory for all real estate builders in the country to register their properties under the RERA. While registering under the RERA Act, builders must provide several details of the property, including the estimated handover date, floor plans, etc. All RERA-approved projects are listed on the state government’s official website and provided with unique RERA registration codes. As a homebuyer, one can visit the RERA website of their state to find the details of specific properties. For example, if someone is interested in buying a house in Maharashtra, they can visit the MahaRERA website and browse the details of their favourite properties. This has helped immensely in simplifying the process of homebuying in India
Before the implementation of the RERA Act, there was little regulation in the process of purchasing a home. There was no standardised method for the calculation of the carpet area of a property. For the same residential unit, the calculation of the carpet area would be 1200 square feet for one developer, while the same would be calculated as 1000 square feet for another builder. However, implementing the RERA Act brought a standardised method for builders to calculate the carpet area of their properties. As per the formal definition under the RERA rules, the carpet area is “the net usable floor area of an apartment, excluding the area covered by external walls, areas under service shafts, external balconies or verandah area, and exclusive open terrace areas. It can include the area covered by internal partition walls of an apartment”. This directly impacted real estate prices across the country as it reduced fraudulent practices, which led to calculating the cost of properties as per the defined carpet area.
Under the RERA Act, a builder must provide regular updates on the construction status of a project to homebuyers who have already invested in it. They are also mandated to update the construction status of their projects and upload the details on their websites. These may include how many flats in a project are sold to date, the price value of each flat, etc. Such an arrangement allows homebuyers to make an informed decision while buying a property. It also helps those who have already invested in a property to stay updated about the construction of their house.
One thing that the implementation of the RERA Act has done is it has forced the builders to provide timely possession of properties. If a builder fails to complete the construction of its RERA-registered projects in time, it may have to pay a penalty to the government and even face imprisonment. Besides, it has to pay interest to homebuyers as per the RERA rules.This has helped in eliminating a big problem faced by homebuyers before RERA, i.e., unruly delay in the handover of under-construction residential projects.
The Indian real estate industry – which was losing its trust among investors – is again booming, thanks to the implementation of the RERA Act. With builders and promoters regaining their lost trust, homebuyers and investors worldwide have started investing in the Indian real estate sector. This has provided a huge boost for the industry that badly needed a revival only a few years ago.
Over the years, the real estate industry has seen several changes in terms of rules and regulations. However, the RERA Act includes a comprehensive law that controls and regulates the Indian real estate industry. With its reputation and reliability, Piramal Realty and its properties across Mumbai have flourished after the implementation of this Act.Disclaimer- This article is based on the information publicly available for general use as well as reference links mentioned herein. We do not claim any responsibility regarding the genuineness of the same. The information provided herein does not, and is not intended to, constitute legal advice; instead, it is for general informational purposes only. We expressly disclaim any liability, which may arise due to any decision taken by any person/s basis the article hereof. Readers should obtain separate advice with respect to any particular information provided herein.
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