In this blog you will get idea about 10 Major Benefits of RERA Act for Home Buyers .
Real Estate Regulatory Authority (RERA) Act was introduced in the May 2016 from then it gives so many relief to the people who want to invest in the real estate market.
The main goal of the RERA act is to safeguard the interest of the home buyers and to create a sense of standardization in the real estate market. With the launch of this act in place, there is no place for developers to do any mistakes to home buyers.
This act gives a boost to real estate development in India that gain trust in the eye of the customers.
This act creates a system wherein issues like project delays, quality of the stages of construction, pricing and value of the property, etc can be solved with higher transparency.
RERA’s main objective is to promote transparency, accountability, and efficiency in the real estate sector.
Here is the list of 10 major benefits of the RERA Act for home buyers we share.
1. Standardized Carpet Area :
Carpet area is the area that can actually usable area which is to be covered by a carpet, or the area of the apartment, excluding the thickness of inner walls.
Before Rera act builders have their own method or formula for calculating the carpet area of a flat/property.
But rera has standardized or formulate how a builder calculates the carpet area.
With the launch of the RERA (Real Estate Regulation and Development) Act On May 1, 2016, A Builder needs to clarify how much carpet area they are offering as the Result.
The price of property in India is now dependent on Carpet Area.
This act has a direct impact on price which a builder charge on Property. The following formula a builder uses when calculating the price of a property – Cost Of Property = Carpet Area x Rate Per Square Fit.
2. Right to Information About the Property :
This is one of the main benefits of the RERA act for Home Buyers.
You as a Home buyer need to know all the necessary information about the property you are buying.
This Kind of information can be very helpful for a home buyer in future decision making.
The Developer or Builder is entitled to share all the details regarding the individual project such as Plan Layout. Stages of construction, Plan of execution, Status of completion, etc.
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3. Builders Won’t Be Able to Delay the Projects :
Under this Benefit of new RERA act. 2016, each property developer have to give a due date of the possessions of the flat.
And if the developer is not able to complete the project until that date, then they will have to face many penalties.
If the developer failed to give possession on the given date then the buyer has the following options –
- To withdraw from the project – wherein he/she is entitled to get a full refund along with the interest.
- To continue with the project – in this case, he/he is entitled to get compensation along with interest
4. Builders Will Be Held Responsible for Any Defect or Fault in The Construction :
Under this RERA Act provision, if a buyer discovered any defect or fault in the construction, Quality or provision of the flat within 5 years after the possession of the flat such defect will be rectified by builder within 30 days at no extra cost.
If the builder failed to repair the defect, then the buyer shall be entitled to get compensation.
5. Grievances Will Be Addressed and will Solved Quickly :
If the buyer finds any dissatisfied with the construction or issue regarding the flat, then the buyer has authority to take action against the builder in Appellate Tribunal under RERA act.
The tribunal will address your case within 60 days of Grievance case files. And if the Tribunal failed to solve the problems it shall give the reasons for such failures.
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6. Advance Payments :
A Builder cannot take more than 10% of the cost of the Flat as an advance or application fees before entering in the agreement of sales. This is one of the major benefits of Rera.
7. Right Of the buyer in case of any false promises :
In Case of any mismatch in the commitment or Promises made by the builder regarding the actual project.
Then the buyer has the option to withdraw from the projects, wherein he is entitled to get a full refund of the amount he paid as advance or in some cases interest and claim compensation.
8. Builders will need all clearances before selling
Earlier days, builders used to sell a project that did not have all clearances. Results many complected problems to the home buyers.
But under RERA Act. All developers, builders and real estate agents will have to register himself with the regulator, and disclosing all each and every detail about the projects and
then only they can sell projects only after the necessary clearance have been verified.
9. Builders won’t be able to use your money for some other project :
Untimely delivery of real estate projects has been the biggest Problem for Home buyers.
According to Economic times, almost all the real estate project launched between 2010 and 2013 had defaulted their possession date primarily because of the fund collected by the builder from buyer were diverted to a new project.
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However Under new RERA act.
The developer will have to transfer 70% of the money received from the buyer to an escrow account. And after which.
The money will be withdrawn as per the stages of the construction, and it should be approved by the engineer and CA of the builder.
10. Reduction in Prices of Real Estate :
When RERA act comes to action in 2016 it has a direct impact on the price of the home, land and interest rate of your home loan.
Because of the RERA act, The trust and transparency in the real estate business have been improved. Investment is also increased in the real estate sector.
All these signals give Growth to the sector and higher demand is slowly decreasing the price and therefore the interest rate on home loans
The benefits of RERA are not just limited to homebuyers, but it also helps the developers and real estate agents in a number of ways.
RERA act is making the Real Estate sector more professional and secure for investors builders as well as Buyers.
At the end make sure you buy a project which is registered under regulatory authority!
With the RERA Act at your rescue, it is just the right time for you to Get for a hassle-free home loan and start your journey for buying your Dream Home.
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