The Real Estate (Regulation and Development) Act (RERA) was passed by the Indian Parliament in March 2016. The Act came into force in May 2016. According to the Act all projects with land over 500 sq. mts or with at least eight apartments will be registered with the Real Estate Regulatory Authority for launching the project. Once registered the developer will have to put all the details of the project on the website and its login will be provided to the investors. 70% of the amount being invested in the project has to be deposited in the banks. The developers will have to sell the project based on the carpet area and not on the basis of super-built up area. A Real Estate Regulatory Authority and Appellate Tribunal will be set up state wise to look into the complaints of the investors. Stringent penalties are in place for the developers who do not show compliance to the provisions of the Act. The allotment has to be made on the promised time or else the investor can withdraw from the invested amount. Besides, there are many other provisions that protect the rights of the investor.
Definitely, RERA shall bring greater transparency and accountability in the business and promote a lot of positive sentiment amongst the customers. This in turn will differentiate chaff from the grain and only developers with a real and genuine legacy will be able to do business.