RERA is an Act of India to ensure regulation and promotion of Real Estate Sector in India. RERA required to establish Real Estate Regulatory Authority in each state to make sure the sale of apartment or plot in an efficient manner. This act has come into effect in 2016 and since then, it has become mandatory for all the builders and developers to register their new and ongoing projects and the agents to register themselves with the RERA with aim to protect the interest of home buyers.

Now a days when many of the developers are failing to deliver the projects on time due to cash crunch RERA is expected to a little bring relief to home buyer since developers are accountable for timely delivery. The genuine developers are most likely to gain the confidence in a regulated ecosystem. In RERA, Developers are required to take permission from all the authorities and mention the same at their portal and respective State RERA website. There are penalty provisions for Real Estate Agents or Promoters failing to register as per the provisions stipulated in RERA Act 2016.

All the registered Agents are provided with a registration number After the registration which is to be quoted in every transaction facilitated by the registered person. All Real Estate project are required to be registered under RERA except in the cases where the area of the land proposed to be developed does not exceed 500 square meters or the number of apartments proposed to be developed does not exceed 8 units inclusive of all phases. In case of failure of RERA Registration, there is a penalty of 10 % of project cost or 3 years imprisonment for defaulters.

Key Features of RERA

1. RERA authority is required to set up in every State and applies to both residential as well as commercial properties.

2. After RERA Carpet area of a property is considered for sale instead of super built-up area.

3. Builders needs 70% of the funds collected from buyers are required to deposit in a separate Bank Account for construction.

4. Projects with plot size of atleast 500 square meter or 8 apartments are required to be registered with RERA

5. Project details has to be disclosed by the developers like project cost, financials and legal title deed and updated on quarterly basis with progress of construction.

6. An interest rate of 2% above SBI’s MCLR is to be paid by developers in case of any delay.

7. Promoter is required to rectify any structural or workmanship defects in the building occurred in 5 years of construction within 30 days.

8. Developers cannot demand for more than 10% of the property cost as an

9. A maximum of 10% of the property cost can be demanded as advanced payment booking amount.

10. Developers can not advertise, offer to sell or book any plot or apartment without registering with RERA.

When RERA Registration is not required?

1. Where the Project completion certificate is received before commencement of RERA.

2. Where the land to be to be developed does not exceed 500 square meters or not more than 8 Apartments are to be completed.

3. Where the projects related to repair of an existing structure which does not require advertisement or selling of any apartment.