What is RERA and How Does it Impact Real Estate Transactions?

August 7, 2024

RERA stands for Real Estate Regulatory Authority which came into existence in 2017 by the Real Estate (Regulation and Development ) Act 2016. It intends to regulate the real estate sector, protect the interests of homebuyers and investors, and bring transparency and accountability to the industry. It aims to save homebuyers from fraudulent practices that were prevalent before the act. The regulatory body oversees real estate transactions to protect homebuyers and investors from any discrepancies in the industry.

How does RERA help property investors and buyers?

The key benefits of RERA are :

1. Increased transparency

Every developer must mandatorily register their projects with UPRERA and provide important project details like project plans, approvals, permissions, carpet area details, and timelines on the official website. Property buyers can make informed decisions by referring to the information online and not depending on the developer.

2. Protection from delays

Developer is mandated to meet deadlines as declared on the RERA website (www.up-rera.in) failing which they are liable to heavy penalties. This ensures that the buyer is protected from delays and financial losses.

3. Dispute resolution

The act ensures that any disputes between the parties are resolved faster fairly and transparently.

What should home buyers know?

1. Verification

The property buyer should verify all the claims made by the developer by cross-checking them on the RERA website. The developer’s details can also be found on the website which confirms their legitimacy.

2. Carpet area

RERA mandates the sale of properties based on the carpet area which is the net usable floor area of the apartment’ that does not include external walls, service shaft areas, balconies and verandas, and terrace areas. Developers may quote the built-up or super-built-up area and hike the prices which is not legal.

3. Agreement review

RERA mandates standardized agreements that clearly outline the payment details, possession timelines, and other crucial details. These details should be carefully reviewed and understood before signing.

4. Rights and responsibilities

RERA empowers property buyers with rights like demanding a refund of the deposited amounts or penalties in cases when the project is not delivered as per timelines. The developer cannot demand more than a 10 % deposit from the buyer or make any changes to the preapproved plans without the consent of the buyer. It is important to be aware of all rights and enforce them if needed.

RERA is a significant step by the government to ensure transparency and security in the real estate market. Homebuyers can navigate the process of owning property by knowing their rights and making the most of the resources available with UPRERA.