To protect the home buyers and to improve the real estate economy, the parliament of India brought “The real estate Regulation and Development Act” which is a set of guidelines set by the parliament of India to prohibit discrepancies in the real estate industry. Builders are now mandated to register with State Real Estate Regulatory Authority by 30th July and also need to deposit 70% of the amount collected through sale to the project’s development. This has been a huge blow for the developers as they cannot use the amount to fund other properties. The builder now has to rectify any structural damage caused to the property within a span of 5 years which is a step taken by RERA to improve the quality of raw materials used for the construction of the property.
RERA will act as a regulatory body for the real estate industry to make it more transparent and accountable in favour of the homebuyers. Almost all the states have been notified of the rules except 5 states namely Arunachal Pradesh, Mizoram, Meghalaya, Sikkim and Nagaland due to constitutional challenges. 9% of the gross domestic product is brought from the real estate industry. The regulation will boost investments as more sale is projected in the coming years.
What is the present condition in India?
Since the formation of RERA, a staggering amount of complaints were registered from the buyer side and RERA is finding it difficult to cope with the expectation. Most of the grievances from the buyer side are due to the delay in handing over possession of the property even after the agreed upon date. Now according to RERA, if there is any delay in the possession of property from the developer side to the buyer, they will have to pay 2 % interest rate above the lending rate. RERA is facing resistance from the builder side as well since they are unable to fund new projects with the payments from existing unless they have completed the project.
But why is the implementation slow?
RERA and its guidelines have some flaws at present but will evolve to be a central authority for the real estate industry by next year. Builders will have to move forward from a traditional to a more progressive approach to provide a better experience to the home buyer as RERA supports the latter.
How we can help you
ADDA will help the builders improve their customer satisfaction by providing the best solution to manage every aspect of all their properties in a single dashboard. Builders will now be able to maintain a healthy relationship with the residents through ADDA. In a time where technology is revolutionizing the world and laws are changing for the better, builders are in dire need for a solution to move ahead in the industry. With experience in managing more than 20,000+ associations, ADDA will help you improve your experience as well as your customer experience.