Features of Real Estate Regulator Bill 2016
With the passage of the Real Estate Regulator Bill 2016, the Indian buyer/ investor can certainly take a cool breath as the Legislators in India has given a thumps up to pro buyer/investor regulation. While summarizing the entire Law, we need to look into the following pointers as the bold markers of the Law:-
- 1)As per the Bill, there will be a state level regulatory i.e. The State Real Estate Regulatory Authority for each state so that the aggrieved person can approached for redressal of grievances against any builder.
- The State Real Estate Regulatory Authority will govern both residential and commercial real estate transactions.
- As per the Bill – a Builder/ Developer is duty bound to reserve and keep 70% of the Project Funds in a separate bank account or escrow account. This step will secure the fund of that particular project to be utilized in the same project, though earlier the same fund were siphoned illegally by the developers and invested into their future / new projects and this was the main reason for the collapse of the residential projects. Perhaps this evil practice will end now.
- As per the Bill-it is mandatory for each builder/developers to publish/post/highlight all information of the project s such as project plan, layout, government approvals, land title status, sub contractors to the project, schedule for completion with the State Real Estate Regulatory Authority (RERA) and then inform the buyers/ investors subsequently.
- As per the Bill – the Super Area, Built Up Area and Carpet Area has been defined categorically so that the builders cannot take the help of sugar coated words and confuse the buyers. Carpet area has been clearly defined in the law.Meaning thereby that you will get exact the same area which has been mentioned in the Builder Buyer Agreement/ Sale Deed.
- As per the Bill the builders/ developers have to face the music in case of Delay in Project. Generally in the present scenario, if a project is delayed, then the developer does not suffer any loss. The new Bill ensures that any delay in project completion will make the developerliable to pay the same interest which a consumer is paying to the Bank in the form of his EMI.
- As per the Bill the violations would lead the builder/ developer to jail which is a welcome move. The term for a developer who violates the order of the appellate tribunal of the RERA is three years with or without a fine.
- As per the Bill -The developer cannot make any changes to the plan that had been sold without the written consent of the buyer. This puts paid to a common and unpopular practice by developers to increase the cost of projects.
- Who are the builders/ developers covered under this new Law?- Any project measuring more than 500 square metres or having more than eight apartments will have to be registered with the RERA
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