The Real Estate (Regulation & Development) Act, 2016, the landmark realty law that aims to shield home buyers from deceitful developers arrived to impact 1 May 2017. The move ends a nine-year long wait.
The implementation for the act means unsafe effects of the real estate sector, which hosts over 76,000 companies along the country.
• The Real Estate (Regulation and Development) Bill, 2016 was passed via the Parliament in March 2016.
• The act partially arrived to force in May 2016 with 59 of that 92 notified sections put to force.
• Now, lots of 92 chapters of the Act have enter effect.
• The states received the duty of notifying towards realty rules and hang up a Real Estate Regulatory Authority (RERA) by 30 April 2017, without which regulations won't become operational.
• Till now, 13 states and Union Territories including Delhi, Madhya Pradesh, Gujarat, Maharashtra, Odisha, Andhra Pradesh, Uttar Pradesh, Bihar, Daman and Diu have notified the rules.
Speaking to the occasion, M Venkaiah Naidu, the Union Minister of Housing & Urban Poverty Alleviation said that act marks the beginning of a new trend making buyer the King while developers utilize the confidence for the King on the regulated environment.
He further added that act brings for it the much-desired transparency, accountability and efficiency on the sector, considering that it defines the rights and obligations of both the buyers and developers.
Provisions for the Act
• Buyers and developers of housing property can seek relief by approaching Real Estate Regulatory Authorities against violation for the contractual obligations besides other provisions for the Act.
• The act offers the mandatory registration of projects and housing agents.
• The act mandates depositing of 70 per cent for the funds collected from buyers in an independent banking account from new projects and 70 per cent of unused funds from ongoing projects.
• The funds could be withdrawn just for construction purposes.
• Additionally,it mandates the registration of projects that has a plot scale minimum 500 sqm or 8 apartments when using the Regulatory authorities.
• The act also prescribes penalty on developers from delay on the project. The developers would be asked to disclose the project details on websites for the regulator and still provide quarterly updates on construction progress.
• Using act, the developers can be accountable for virtually any structural defect in the real estate for five years.
• The act also prescribes imprisonment nearly few years for developers or longer to 12 months for agents and buyers from violation of orders of Appellate Tribunals and Regulatory Authorities.
• The Regulatory authorities would also be asked to recycle complaints in 60 days and Appellate Tribunals would be asked to adjudicate cases in 60 days.
Overall, the act would as well as enhance consumer confidence but probably conserve the sector in total, as in conjunction with attracting more investments could possibly also open doors for Foreign Direct Investment (FDI). It will ensure effective implementation of housing projects like ‘Housing for All by 2020'and ‘Smart City '.