What RERA Has In Store For Bangalore Property Buyers

A dramatic transformation  will hit  the real estate with the overturning of the rule books and ushering in of customer friendly ecosystem due to  the enactment of  the Real Estate (Regulation and Development) Act, 2016 (RERA) .  Each State and Union Territory is mandated to set up its own Regulatory Authority under the Act that will moreover contribute to clarity and transparency. Each Regulatory Authority at the state level will be responsible for setting up and    maintaining a website, that will put up the records of all projects registered. Significantly, the Act’s  rolling out   is proceeding in slow phases as only a  few states comprising Gujarat, Uttar Pradesh, Madhya Pradesh and Odisha have finalized  their rules till date while only drafts    have been   outputted by Rajasthan, Karnataka, West Bengal, Maharashtra and Tamil Nadu. The Centre is constrained since the RERA model mandates   that it has only the power of recommendation, as land being a state subject, the states must formulate and pass their own laws.  Bengaluru has hence yet not come under the ambit.

When RERA   takes effect, it will usher in an era of long wished by all stakeholders. Transparency will be the structural norm for buyers, investors as well as developers. Long –term assurance & guarantee on construction quality will also be ensured. By default,   all real estate developers in Bangalore who have built up trust over the years and will under the ACT to strengthen it. The RERA rules structurally reinforce it by enabling protection against inferior quality in construction till at least 5 years from the time of possession. For example, if you are buying villas in Harlur Road, Bangalore, or anywhere else, you will be protected against inferior construction till 5 years after handing over. In case of appearance of structural defect/s, lack of construction quality or reneging on services/ obligations, the developer is duty bound to rectify these.

Though the prices have held their course inspite of unsold inventory, demand absence and demonetization, the RERA will serve to decrease prices. Though initially the developers will pass on enhanced costs of enhanced transparency, buyer-protection and quality control, it will settle down as the Act will eliminate the need to hold stocks and consequent speculation. The strict deadlines on project delivery are expected to bring down the costs.

 RERA will fortify real estate investments as the developer must deposit 70 percent of the amount in an escrow account. Under this Act, the investments will also become more transparent since developers are required to upload and register with the Authority such vital details as financial statements, copy of legal title deed and other documents. Registration is mandatory before advertising; marketing or selling the units/projects as such advertisements   must necessarily carry the RERA registration number.

Inordinate delays dragging into interminable legal cases will now be a thing of the past .Under RERA, stringent terms assure timely delivery. Hence, if    investors invest in real estate, they will not be inconvenienced by unexpected delays. The developers should also maintain a 'separate account' for each project to deposit 70 percent of the money received. All of these factors will also ensure genuineness of buyers and sellers under a competent authority.

The measures   will thus ensure transparency trust, quality speed and grievance redressal to all buyers’ investors and developers once the RERA comes into force in Bengaluru.