How RERA will change the Real Estate Market?
The real estate industry in India till recently was a highly unorganised sector and there were only a few regulations that governed the industry and its stakeholders. This changed with the enactment of The Real Estate (Regulation and Development) Act, 2016 (RERA).
Under the Act, every state and union territory has its own regulator. Builders and real estate brokers are required to be registered as per the Act. Moreover builders are required to maintain a separate escrow account for each of their projects. 70 percent of the funds received from investors and buyers will have to be deposited in this account. This clause will ensure that the funds deposited are used solely for the construction of the project. Builders have to also submit their original approved plans and any modifications made thereafter. The regulatory requirements do not end there. They are required to provide details of funds collected from allottees and a complete report as to how these funds were utilized. The project completion date and blueprint also have to be furnished.
These are but a few of the many rules under RERA that are bound to bring in accountability in an industry where builders ruled the roost. RERA is a much awaited change that will safeguard unsuspecting buyers and sellers.