What is RERA? Benefits of RERA, How It Works, and More | A Complete Guide to the RERA Act 2016
In this blog, we will understand in depth what is RERA, what are the benefits of RERA, the full form of RERA, what is RERA registration, what is carpet area as per RERA, what is a RERA certificate, what happens if the builder delays possession as per RERA, and more. So let us start this blog.
What is the RERA Act?
RERA stands for the Real Estate Regulatory Authority. This act was approved by the Indian government in 2016 to bring transparency, accountability, and efficiency to the real estate sector.
In simple terms, RERA aims to protect the interests of homebuyers and promote fair practices in the real estate industry. It mandates that all real estate projects must register with the regulatory authority, providing complete details of the project like timelines, layout plans, and financial information.
In conclusion, the RERA Act brings professionalism to real estate, prevents delays, and ensures the timely completion of the project. Additionally, it seeks to promote professionalism in the real estate sector by enforcing strict guidelines and penalties for non-compliance.
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What is the full form of RERA?
The full form for RERA is Real Estate Regulatory Authority.
What are the Benefits of the RERA Act?
Here are the benefits of the RERA Act in the real estate sector.
1. Transparency: It is one of the most important benefits of RERA; it brings transparency to the real estate sector by mandating that developers register their projects with detailed information on timelines, plans, and finances. It helps buyers take suitable action.
2. Accountability: Developers are held accountable for delivering projects on time and as per the promised specifications. They must adhere to strict guidelines, reducing the likelihood of project delays or deviations.
3. Protection for Homebuyers: RERA safeguards the interests of homebuyers by requiring developers to deposit project funds in separate accounts (escrow accounts), preventing diversion for other purposes. This protects buyers from financial risks associated with project delays or non-completion.
4. Timely Possession: The major impact of the RERA Act is that it reduces the chances of delays in project completion. It assured homebuyers of timely possession of their properties, minimizing uncertainty and inconvenience.
5. Dispute Resolution Mechanism: RERA establishes a structured mechanism for resolving debates and clashes between buyers and developers. The RERA Act ensures that buyers have direction for addressing injustice and enhancing consumer protection.
6. Promotion of Professionalism: The Act promotes professionalism in the real estate sector by enforcing standards and penalties for non-compliance. It ensures that developers maintain ethical practices and deliver quality projects.
7. Streamlined Approval Process: RERA streamlines the approval process for projects, reducing bureaucratic hurdles for developers. This facilitates smoother project implementation and contributes to overall efficiency in the industry.
8. Enhanced Trust: One of the major benefits of the RERA Act is that it brings trust and transparency in the real estate sector, which gives buyers confidence. RERA promotes a positive environment for investment and growth in the real estate sector.
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What is RERA Registration?
RERA registration is a mandatory process through which real estate developers must register their projects with the regulatory authority established under RERA. This registration is aimed at ensuring transparency, accountability, and consumer protection in the real estate sector.
To register a project under RERA, developers are required to provide detailed information about the project, such as timelines, layout plans, financial details, and legal documents. After submission, this information is inspected by the regulatory authority to verify its accuracy and compliance with RERA guidelines.
Upon successful registration, the developer is issued a unique registration number for the project, which must be prominently displayed in all advertisements and promotional materials.
Additionally, developers are required to regularly update the regulatory authority on the progress of the project, including any deviations from the original plans.
RERA registration is crucial for both developers and homebuyers. It ensures that developers adhere to legal and financial standards, reduces risks for buyers, and promotes trust in the real estate market.
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What is a RERA Certificate?
The RERA certificate is proof of a builder’s compliance with the RERA Act. It is issued by the state’s RERA authority after successful RERA registration. This certificate serves as proof of the project’s legality and adherence to the Act’s provisions.
The RERA certificate is a valuable and important document for both developers and homebuyers.
For developers, it is a requirement for promoting and selling properties within the project. For homebuyers, it provides assurance that the project is legal and adheres to the standards set by RERA.
What is Carpet Area as per RERA?
The carpet area, as per RERA, refers to the actual usable floor area within the walls of a residential unit. It excludes the thickness of inner walls but includes the balcony, veranda, and attached terrace area if it forms a part of the exclusive apartment.
In simpler terms, it’s the space where you can lay a carpet. This measurement excludes non-usable areas like walls and common areas. RERA mandates that developers provide accurate carpet area details to buyers, ensuring transparency and fairness in real estate transactions.
The carpet area as per RERA helps homebuyers measure the actual space available for living and helps in comparing properties effectively. It’s a standardized measure that protects buyers from misleading advertisements and ensures they get the space they pay for.
What is the difference between RERA Carpet and Actual Carpet?
The difference between RERA carpet area and actual carpet area lies in what each measurement includes.
RERA carpet area is a standardized measure defined by the Real Estate (Regulation and Development) Act, which refers to the usable floor area within the walls of a residential unit. It excludes areas like balconies, verandas, and walls but includes the thickness of inner walls.
On the other hand, actual carpet area typically refers to the total floor area covered by carpets or flooring within a residential unit, including all rooms, passages, balconies, and utility spaces. It may or may not conform to the RERA guidelines.
It’s essential for homebuyers to clarify which measurement is being used when evaluating properties to make informed decisions about space and value.
What is RERA Approved?
RERA approved is the official green light given by the Real Estate Regulatory Authority for a real estate project. It shows the project meets all the legal rules and regulations set by RERA to protect buyers and ensure transparency in the real estate market.
What happens if the builder delays possession as per RERA?
If a builder delays possession of a property as per RERA regulations, there are consequences.
Firstly, the builder may be required to compensate the buyer for the delay. This compensation typically includes paying interest on the amount already paid by the buyer.
Secondly, the buyer has the right to withdraw from the project and receive a refund along with interest. Alternatively, they can choose to continue with the project and claim compensation for the delay.
RERA also empowers the buyer to file a complaint with the regulatory authority against the builder for the delay. The authority can then take necessary actions against the builder, which may include imposing penalties or even revoking the builder’s registration.
Overall, RERA ensures that builders adhere to timelines for possession, and if they fail to do so, buyers have legal recourse to seek compensation and resolution for the delay.
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FAQs
What is the full form of RERA?
The full form of RERA is Real Estate Regulatory Authority
Is it safe to buy RERA approved projects?
Yes, purchasing a RERA-approved project is generally considered safe. RERA approval means that the project has been vetted and authorized by the Real Estate Regulatory Authority, ensuring that it meets specific legal and financial standards.
Is it safe to buy an apartment which is not RERA approved?
Buying an apartment that is not RERA-approved can be risky. RERA approval ensures that the project complies with specific legal and financial standards, providing buyers with transparency, accountability, and consumer protection.
What is the benefit of RERA?
The benefit of RERA is that it protects homebuyers by ensuring transparency, accountability, and fairness in the real estate sector. It helps prevent fraud, delays, and disputes, making the buying process safer and more reliable.
What is the main objective of RERA?
The main objective of RERA is to protect the interests of homebuyers by promoting transparency, accountability, and efficiency in the real estate sector. It aims to regulate the real estate industry, prevent fraud, and ensure timely delivery of projects.
Why is a RERA certificate important?
A RERA certificate is important because it confirms that a real estate project has met the legal and financial standards set by the Real Estate Regulatory Authority (RERA). It assures buyers that the project is trustworthy, transparent, and compliant with regulations, reducing the risk of fraud or misrepresentation.
what if project is not registered in rera?
If a project is not registered with RERA, it means it’s operating illegally, and buyers should be cautious. Without RERA registration, there’s no oversight to ensure the project meets legal and financial standards, which can lead to risks like delays, quality issues, or fraud. You should not go with a project that is not RERA-registered.
What is built up area as per rera?
According to RERA, the built-up area refers to the total area covered by a residential unit, including the carpet area plus the thickness of the walls. It includes all enclosed spaces within the walls of the unit, such as rooms, kitchens, bathrooms, and balconies, but excludes common areas like staircases and lobbies.
What is RERA escrow account?
A RERA escrow account is a special bank account where developers are required to deposit a portion of the funds collected from buyers for a specific real estate project. This account is monitored by the Real Estate Regulatory Authority (RERA) to ensure that the money is used only for that project’s development and construction.
