RERA Act: Seven things homebuyers should know

Are you still waiting for the possession of your home your builder promised? Is the builder not paying you interest on the delayed possession of the property? Is the quality of construction not good?

To address such issues, the central government passed The Real Estate Regulation and Amendment Act (RERA) in 2016, which became effective from April 30 2017. The Act was brought to bring in transparency in the real estate sector and reduce project delays and mis-selling.

Belying the notion, consumer courts have been brimming with complaints against real estate developers on the number of issues ranging from delayed possession to poor construction quality. It is therefore important for buyers to understand know their rights under RERA.

At present it is compulsory for all developers to register under RERA before launching a project. It is applicable on projects with a land area greater than 500 square meters or 8 apartments before launch. In addition, land being a state subject, RERA authority is under state governments and therefore there may be variations in enforcement on state to state basis.

Here’s a lowdown on rights of homebuyers under RERA:

1) If there are any structural defects within 5 years of possession, you can escalate the issue with your builder who will have to repair these damages within 30 days at no cost to the buyer.

2) Before RERA was implemented, the interest paid by the builder for delayed possession of the property was much lower than the interest paid by the buyer in case of delayed payment to the developer. After RERA this has changed and now both you and your builder have to pay the same amount of interest. The builder cannot charge you more and pay less in case of any delay in payments.

3) In case of mismatch in what was promised and what was delivered, you can ask for the full refund of the amount that has been paid by you to the builder.

4) You are entitled to get complete information relating to layout and sanctioned plans approved by the competent authority or the agreement for sale signed with the promoter.

5) You can get stage-wise time schedule of completion of the project. You can also ask for other amenities and services such as electricity and water to make sure it is in tune with the terms and conditions of the agreement for sale.

6) If either of the party -buyer, builder and agent-has any complaints in relation to the property they can file a complaint with RERA. If you are not happy with the decision of RERA you can escalate and the complaint with the Appellate Tribunal.

7) The builder has to deposit 70% of the amount collected in an escrow amount in order to make sure that the money from one project is not diverted to another. In case of any diversion there are fines and penalties on the builder for not following the guidelines.

So, if you are having any trouble with your builder do take-up the case after knowing above mentioned rights.