So far, four states including Madhya Pradesh, Gujarat, Uttar Pradesh, Maharashtra and Six Union territories have implemented the Real Estate Act and notified the final rules. This act is considered as one of the very important reforms that will bring more transparency to the realty segment and stakeholders shall be able to derive benefits with its implementation. As the Act will get in its full operation from May 1, 2017, all the states are expected to notify for the final rules including the agreement for sale rules, general rules and establish the appellate tribunals as well as rules & regulatory authority latest by April 30th 2017.
All the rules notified by the states have been forwarded by the central government to a parliamentary committee for examination. Ministry of HUPA also organised a workshop to review the progress last month. Andhra Pradesh, Jharkhand, Arunachal Pradesh, Chhattisgarh, Karnataka, Haryana, Himachal Pradesh, Kerala, Mizoram, Rajasthan, Tamil Nadu and Pondicherry are expected to notify their real estate rule in February. However Uttarakhand and Punjab said that they shall only be able to notify the rules after assembly elections.
The HUPA minister also clarified that in the absence of rules and regulatory authority as well as appellate tribunal, there shall be a vacuum in the realty sector as the Regulatory Act shall get affected in these states.
What Is Real Estate Act?
The real estate act was brought in consideration with regulating the properties and is considered as the biggest reform in the real estate sector till date. The RERA (Real Estate Regulatory and Development Act) 2016, was proposed way back in January 2009 but it got its date of operation as 1 May 2016.
Important Clause of Real Estate Act 2016
• Compulsory Registration of all Residential Real Estate Projects of plot size more than 500 sq. meters.
• Written agreement for sale or builder-buyer agreement.
The agreement must be offered to the home buyer for signing before accepting 10% of property value as advance.
• Developer can sell the property only on the basis of carpet area and NOT the super built-up area.
• Before bringing any change in the structure of the property under construction, promotors are to have consent of two-thirds (66%) buyers.
Penalty Clauses
• Penalty of 5% of project cost on incomplete disclosure of the property.
• Cancellation of the running project in case the rules are regularly flouted.
• The association of allottees can claim their money back if the project is left half-way for any reason.
• A demand for completion of project by another developer can also be raised from the authority by the allottees.
RERA Aims At:
• Fast process of judgment.
• Relief to home buyers in case of disputes
• Proposal of 644 district-level consumer courts
• Shielding the interest of home buyers in the primary real estate market.
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