RERA: The new era with Plus Points for Home Buyers in Real-Estate Sector

For long, the real-estate sector was unregulated and always in favour of the builders. From getting delayed possession of the property to facing a huge monetary loss of the project cancellation, all have to be endured by home buyers.

And in the worst situation, even after living for a long period of 10-15 years, the owners sometimes need to vacant the house for not getting occupation certificate from the government or any other related issues.

And after enduring all this, if a home buyer files a complaint, it takes several years to get a verdict. However, now to bring a higher level of transparency to this sector, the Real Estate Regulatory Act has come to force in the country with effect from May 1, 2017.

What is RERA?

The Real Estate (Regulation and Development) Act, 2016 is an Act of the Parliament of India which seeks to protect home-buyers as well as help boost investments in the real estate industry. The Act establishes a Real Estate Regulatory  Authority (RERA) in each state for regulation of the real estate sector and also acts as an adjudicating body for speedy dispute resolution. (Source:Wikipedia)

Let us see how RERA addresses the various concerns impacting the buyer’s experience.

Benefits of RERA for Homebuyers

Right to information about the property

The buyer has a complete right to know about the project details from the builder. This includes information related to the project layout, execution or date of possession.

Standardisation of carpet area

Earlier, the builders had their own formula to calculate the carpet area of a property. However, with RERA there is now standard formula for calculating, and also, the builder needs to clarify the exact size of the carpet area. This way, developers cannot provide inflated carpet areas to increase prices.

Grievance Redressal

If the buyer, in case, is dissatisfied with the construction or has any complaints concerning the project, they can file a complaint with RERA. If they aren’t satisfied with RERA’s decision, one can also approach the Appellate Tribunal.

Quality Construction

Builders are required to be transparent about the entire construction process – from construction materials used to the technology employed. If at the time of possession, there are any structural defects or problems in quality within 5 years of possession, the builder needs to rectify the damages at no cost from the buyer within 30 days of the complaint. 

Timely Delivery

The timely completion of the real-estate projects has been greatly emphasized by RERA. Builders are required to mention the possession date of the project, and in the event, if they fail to meet the date of possession, the developer would be imposed an interest penalty.

Advance payment

As per the RERA Act, a builder cannot take more than 10% of the cost of the project from the buyer as advance or application fees. This helps the buyer from having to pay a large amount at the same time.

How to check the status of A Real-Estate Project on the RERA portal:

RERA officials advise buyers to check details of registered projects before making the final buying decision. Here is a step-by-step guide to check information of the registered projects in Karnataka.

1. Go to Karnataka RERA portal – https://rera.karnataka.gov.in/home

Note: The website will always open in the Kannada language. However, you can change the language to English by clicking on the link positioned on the right side top corner of the site.

2. Under the PROJECT LIST tab, click on ‘PROCESSED APPLICATIONS’.

3. Now, you can view six tabs.

• Applications Applied for Registration
• Applications under Process
• Applications under Query
• Applications Approved
• Applications Rejected
• Applications Expired

4. To check the details of the projects under Karnataka RERA, click on the ‘Applications Approved’ tab. All listed projects have their downloadable RERA certificates.

5. Type the number or name of the project in the SEARCH box. On clicking ‘DOWNLOAD’, buyers can see detailed information of the approved project including locality, project type, ongoing status, and proposed completion date.

For example, on the search button, click the RERA registration number of any registered projects under Karnataka RERA. For instance, with RERA number (PRM/KA/RERA/1251/308/PR/180222/002616), you can view details of NVT Mystic Garden project.

What would happen if a project has got an Occupation Certificate (OC) but not A Completion Certificate (CC)?

The RERA Act states that all ongoing, as well as under-construction projects that have not received completion certificate, have to get registered with the regulatory authorities within three months, i.e, July 31, 2017. Properties with a minimum plot size of 500 sq mtr or 8 apartments will fall under the purview of the Act. However, the Act has given exemptions to completed projects which are completed before 1st May 2017.

Can a project not be under RERA and is it safe to buy?

To be precise, we do not recommend you buying a property that is not RERA registered. The sole purpose of RERA’s existence is to protect homebuyers’ interest and having access to all the relevant information while buying a property. You may face serious trouble if you book a property that is not registered under the RERA. You will also be not able to approach RERA for filing a complaint against the builders or any construction quality-related issues.

How can you ensure that the property is RERA Compliant?

RERA Registration Number – A unique number for each project

You need to note down the RERA registration number of the project that you wish to know the details. This number identifies the project and its RERA compliance.

RERA portal

Check the details of the project on the RERA portal with the help of the number.

Size of the property

Any projects with a unit size of a minimum of 500 square meters, or comprising 8 residential units, falls under the RERA act and the builder also needs to register the project under RERA before advertising or launching it.

Escrow account

An escrow account protects seller, buyer , and lender in a real estate transaction. RERA mandates that 70% of the amount must be deposited in a separate account to be maintained in a scheduled bank to cover the construction cost and the land cost of that project alone. Developers with projects registered under RERA must show proof that 70% of the total payment has been deposited by them into an escrow account opened specifically for that project.

The Correct way to buy a property

With rigid norms in place, the real-estate developers are now more accountable and there is a high level of transparency regarding the information of the project. If you are planning to buy a home in Bangalore, all you need to do is check the details of the property you wished to purchase with the help of the RERA registration numbers on the RERA portal.

At NVT, we have a team of professionals with rich experiences in developing high-end residential and commercial projects. We have completed and also, there are ongoing projects in Bangalore. All our projects are registered under RERA.

If you want to know about the details of NVT projects, you can simply put the RERA Registration numbers on the RERA portal. (Our RERA registration numbers are available on our own website and also, on various other real-estate websites like Commonfloor, 99acres, homznspace, Magicbricks etc)