If you’re living in the Prestige Park Grove apartment complex in Whitefield, Bangalore, you might be familiar with the Real Estate (Regulation and Development) Act, also known as RERA. RERA is a regulatory framework that was enacted in 2016 to promote transparency, accountability, and efficiency in the real estate sector. It provides a comprehensive mechanism for the regulation and promotion of the real estate sector in India. In this article, we will discuss the potential changes and updates to the regulatory framework of RERA in the future.
Introduction to RERA
The Real Estate (Regulation and Development) Act, 2016, was enacted by the Indian Parliament to regulate the real estate sector in India. The primary objective of RERA is to protect the interests of homebuyers, promote transparency and accountability in the real estate sector, and ensure timely completion of projects. RERA is applicable to all commercial and residential real estate projects and mandates the registration of real estate projects with the regulatory authority.
Key Features of RERA
RERA has several key features that aim to protect the interests of homebuyers and promote transparency in the real estate sector. Some of the critical features of RERA are:
Establishment of Regulatory Authority
RERA establishes a regulatory authority in every state and union territory of India to regulate the real estate sector.
Registration of Real Estate Projects
RERA mandates the registration of all real estate projects with the regulatory authority before they can be marketed or sold.
Compulsory Disclosure of Information
Developers are required to provide detailed information about their projects, including the project layout, approvals, completion date, and any other relevant information.
Escrow Account
Developers are required to deposit 70% of the funds collected from homebuyers in a separate escrow account to ensure the timely completion of the project.
Penalty for Non-Compliance
Developers who violate the provisions of RERA are subject to penalties, including imprisonment and fines.
Potential Changes and Updates to the Regulatory Framework of RERA
RERA has been in place for five years now, and there have been calls for updates and changes to the regulatory framework. Here are some potential changes that could be made to RERA in the future:
Extension of RERA Coverage
Currently, RERA only applies to residential and commercial real estate projects. There have been calls for RERA to be extended to cover industrial and infrastructure projects as well.
Streamlining of Approval Processes
One of the main reasons for project delays is the lengthy approval process. There have been suggestions to streamline the approval processes to ensure the timely completion of projects.
Introduction of a Dispute Resolution Mechanism
RERA does not currently have a dispute resolution mechanism in place. There have been suggestions to introduce a mechanism that would help resolve disputes between developers and homebuyers.
Inclusion of Real Estate Agents
RERA currently does not cover real estate agents. There have been calls to include real estate agents under the regulatory framework of RERA to ensure their accountability and transparency.
Conclusion
The Real Estate (Regulation and Development) Act has had a significant impact on the Indian real estate sector since its enactment in 2016. It has provided homebuyers with a comprehensive mechanism for the regulation of the real estate sector and promoted transparency and accountability among developers. However, there is still room for improvement, and the regulatory framework of RERA needs to be updated and modified to meet the changing needs of the sector. The potential changes and updates discussed in this article could go a long way in ensuring the effectiveness of RERA in the future.
