Over the last few decades, the real estate market in India has grown a lot. People who invested in real estate often made more money than those who invested in stocks. This growth happened because both people buying homes and those investing in properties played a part in it.
But, a few years ago, there was a big worry for people buying houses in India. Builders often took longer to finish building homes than they promised. This led to a need for stricter rules and the government stepping in to solve the issue.
To make real estate investments safer and protect the rights of homebuyers, the Government of India passed a law called the Real Estate Regulation and Development Act (RERA) in March 2016. This law started working on May 1, 2016, and May 1, 2017. According to RERA, all real estate projects must register with a Real Estate Regulatory Authority. Let’s find out what RERA is all about and why it’s important.
What is RERA?
RERA is a law made by the government in 2016 to control and make fair the real estate industry in India. Before RERA, people buying homes often felt that builders had too much power. The government introduced RERA to make transactions between customers and builders fairer.
RERA has a few main goals:
- Protecting the rights and interests of people buying homes in India.
- Making real estate transactions more transparent.
- Ensuring that both builders and buyers share the right information.
- Making builders and buyers more responsible.
- Making the real estate sector more trustworthy to attract investors.
- Creating a quick way to solve problems between buyers and builders.
Why is RERA Important?
Real estate is one of the main ways the government makes money through taxes. Taxes like stamp duty, registration charges, and property tax are collected from real estate transactions.
RERA was needed to make people trust the real estate market in India more. It creates a fair balance between people buying homes and builders, reducing the risks people faced before this law.
After RERA started, buyers can get all the details about a project and check its documents. Builders have to make sure they give homes on time or pay extra if there’s a delay. RERA also ensures that builders sell homes based on the actual area inside, not the total area, making things more clear and trustworthy.
What is RERA Registration?
According to RERA, any real estate project with a land area more than 500 square meters or with more than eight apartments must register. Projects without a completion certificate or occupancy certificate before the law came into effect also need to register.
Builders have to share all details about the project, like land status, approvals, when it’ll be finished, and who the promoters are during the registration process. Builders can’t advertise or market a project without this registration.
To Sum It Up
The Indian government introduced RERA in 2016 to make the real estate sector more transparent and protect the rights of people buying homes. For builders, it means more responsibilities and following the law.
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