The real estate industry is in a transitional period, and proving to be a boon for prospective home buyers. One major reason for this transition is to introduce Real Estate Regulatory Authority (RERA) Bill. The RERA Bill has introduced a number changes to the way real estate businesses are handled between buyer and seller. This will make process easy and hassle free for buyer to buy their sweet home.

The real estate industry is in a transitional period, and proving to be a boon for prospective home buyers. One major reason for this transition is to introduce Real Estate Regulatory Authority (RERA) Bill. The RERA Bill has introduced a number changes to the way real estate businesses are handled between buyer and seller. This will make process easy and hassle free for buyer to buy their sweet home. Investing in residential real estate will prove to be your best bet, but you need to understand RERA reforms better to take full advantage of it.

The centre also has planned to set up a common online platform for the Real Estate Regulatory Authority(RERA) of all states including union territories, to provide an opportunity to home buyers, builders and authorities to come online. Housing and urban affairs dept has said that this move will make the real estate law ‘more strong’. Under the Real Estate (Regulation and Development) Act, 2016, all states are mandated to constitute their respective real estate regulatory authorities (RERA), which provides proper protection to home buyers.

Have a look at how the RERA Bill will change the real estate market in India.

Reason for the RERA Bill

The Real Estate industry is one of the biggest money flowing industry in India. Looking to the large sums of money that are transacted here, the introduction of a digital economy, the Government introduced a new law that made such transactions more transparent and less fraudulent.

Developers and Builders are now expected to notify their local RERA bodies every time they start a new project (exceeding a surface area of 500 square metres). Each project has to be registered under RERA and developer has to provide complete legal details pertaining to the construction of the project. A RERA number is generated for that project, which buyer can check online.

Here are some of the ways the RERA Bill will change real estate market.

Projects will be completed within time !

Completion and handover of projects is a promise every builder makes to buyers, yet due to unforeseen circumstances, the project get delay sometime. This delay can prove to be a hindrance to buyers who wish to settle in to their new home quickly. The RERA Bill has enforced a rule stating that projects must complete within deadlines, while also ensuring timely handover by making developers to set up different bank accounts for each project. Developers are asked to deposit 70% of the funds they receive on a particular project, thus preventing them from using said funds for other projects. In case of delay in completion, developer will be liable for penalty that was previously burdened on the home buyer.

Better quality constructions

After RERA introduction it is now going to get tougher with more developers to fulfill RERA compliance. RERA has given a five-year timeline for developers to fix and repair any deformities even after post completion of their projects, which could indirectly prompt developers to rethink their standards of construction and improve the overall quality of their projects.

Residential project prices may change

Post RERA, favor to the buyer, as developers now have to quote prices based on the carpet area rather than the super built up area. This change in pricing may affect the overall cost of the residential property. The RERA Bill along with Pradhan Mantri Awas Yojana(PMAY) scheme will make real estate more affordable.