The Real Estate Regulator Bill amendments, first proposed in 2013, have passed the scrutiny of the Parliamentary Committee and been approved by the Union Cabinet. However, due to fierce Opposition, its presentation to the Parliament has been postponed to next year. Realty experts believe that once the Bill gets cleared, the real estate sector will pick up.
The Real Estate Regulator Bill Now Passed by Rajya Sabha on 10th March 2016.
Here are some of the highlights of the Real Estate Regulatory Bill:
1. The Real Estate Regulatory Bill will make it possible establish state-level ‘regulators’ for the real estate. The regulator will also grade projects to help consumers make informed decisions.
2. Real Estate developer will have deposit 70% of the project cost in a separate account so that projects can be completed on time.
3. If there is delay in possession, the real estate developers will have to pay the same rate of interest to the buyer as they charge them in case of delayed payments.
4. In case of dispute between buyers and developers over land title, there is a provision of insurance that will avoid loss to both the parties.
5. Developers will have to specify the carpet area of the flats they sell – instead of the super area (which clubs common area with the actual flat area). Parking lots will have to be sold separately too.
6. A buyer has to take possession of the house within two months of receiving the Occupancy Certificate so that the registration can take place in time.
7. Within three months of allotment of majority of flats in a real estate project, it will be mandatory to form allottee associations so that buyers are able to use common facilities for all like club house, reading room, swimming pool etc.
8. Apart from state-level regulators, buyers may also approach 644 district-level consumer courts for quick redressal of their complaints. Appellate tribunals and regulators will have to dispose of cases within 60 days.
9. If real estate promoters or agents disobey the orders of the appellate tribunals, they may have to face imprisonment (up to 3 years for promoters and up to 1 year for agents) or fine of both.
10. The Real Estate Regulatory Bill is applicable to both existing projects as well as projects that are being ‘sold’.
11. Without a prior registration with the real estate authority, developers cannot advertise or launch projects.
12. In order to ensure transparency about the projects, developers will have to disclose layout plans, submit clearances and name the associates, architect, contractor and others with the regulator.
13. Brokers will also have to be registered with the real estate regulator; non-compliance of which will be punishable.
14. The loss in taxable income caused by builders asking the buyers to pay certain amount in cash will now be curbed, thus eradicating corruption.
15. The Real Estate Bill will regulate both, residential and commercial projects
The Real Estate Regulatory Bill is being considered ‘good news’ for trustworthy and reliable builders who know that their fake competitors will soon succumb to the new regulations. The Bill also favors genuine buyers in the market – rather than investors – which means that the ‘supply’ side will increase and real estate prices may see some correction.
Sudeep Agrawal, MD, SHRI Group said, “Regulation will help avoid delays in construction due to improper fund allocations. Also, the regulation to ensure that allottees make timely payments and fulfill responsibilities as per the agreement will cut down on defaults from the buyers. This is something that will help developers be more secure about their returns because if their work is as per the mandate, the allottees need to compensate against the same.”
Content source – https://shrigroup.co/all-hail-real-estate-bill-the-good-news