Considered as one of the most globally acknowledged industries, the real estate sector in India continues to contribute significantly to the country’s exponentially improving economy. Subsequently, the industry is predicted to reach a size of US$ 1 trillion by 2030s and consequently add to 13% of India’s GDP by 2025. It is a result of a complemented growth of corporate environment accompanied by an escalated demand for semi-urban and urban accommodations.
However, there has been a simultaneous increase in the pricing and opaqueness in this sector, owing to increased cases of real estate fraud.
In an attempt to meet and mitigate these growing issues in the realty sector, the Central Government of Indian brought in an initiative of a regulatory body that would oversee the functioning of this industry. This body – RERA UP, has been adopted by over 30 states and UT in India.
Under RERA registration, there are –
- 43,000 housing projects (approximately).
- 34,000 real estate agents (estimated).
- 20,000+ disputes resolved.
All this makes it a mandate for both potential homebuyers and real estate agents to follow up on a complete guide to understand RERA Act in India.
Some of the FAQs to know of –
What is RERA?
Real Estate Regulatory Authority (RERA, UP), is an authoritative body in the real estate sector that was launched in 2016 to bring in absolute transparency in the transactions in this industry. It was primarily launched to safeguard the interest of the prospective house owners and eradicate any existing discrepancy in the sector. Its objectives covered several agendas.
What are the features and benefits of RERA?
Introduction of this act in various cities across India brought in increased investment in realty sector. It holds true for Maharashtra as well where MahaRERA or RERA Maharashtra has processed 18,000+ applications. Such reliance on this Act is due to its impact upon the real estate industry and its benefits that include –
- Significant reduction in project delays and mis-selling.
- Applicable to both residential and commercial properties.
- Safeguards the interest of promoters too.
- Standardisation of carpet area for uniformity of pricing.
This uniformity in pricing of real estate properties ensure fair pricing of areas and hence makes purchasing real estate a convenient affair. Subsequently, with home loans from reputed financial institutions, potential borrowers can also fund their purchase of residential space. Considering the presence of a mortgage, the offered rate of interest is also competitive and hence brings in ease of repayment.
What is the impact of RERA in the real estate sector?
The primary aim of the RERA UP Act was to increase accountability of builders towards prospective homebuyers. Such objectives to act upon the relationship between builders and house owners are sure to alter the real estate market.
It will be a result of the dual-level of the impact that this act would have –
1. For real estate agents – It is imperative for brokers to acquire a license and register themselves. Any cases of them feeding buyers with false information are liable to attract hefty charges or penalties.
2. For builders – It is imperative for builders to register properties that are –
- 500+ square meters or
- have 8 units
3. For homebuyers – With this act, a foundation has been laid for a transparent purchasing process. The RERA Act for first time home buyers is particularly beneficial taking into account–
- Better adherence to law and order.
- Reduced advances (only up to 10% of the property).
- Higher level of accountability.
While these FAQs above cover all that potential homebuyers want to know about this housing regulatory authority, complete knowledge of this ensures that they avail the maximum benefit from this. With the Real Estate Regulation & Development Act, India is looking forward to a far more organised real estate sector fetching a boost in its revenue.
