The Real Estate Regulation Act, which comes to effect from May 2016, promises to secure the interests of home buyers and remove corruption and inefficiency from the sector.
An industry estimate suggests that about 10 lakh buyers invest every year in a house. According to Union Ministry of Housing, a total of 76,044 companies are involved in the real estate sector. It is estimated to contribute about 9 per cent of GDP.
As a house buyer, these are the seven things you need to know about real estate bill:
1. The Bill provides for mandatory registration of all projects with the Real Estate Regulatory Authority in each State. Real estate agents who intend to sell any plot, apartment or building should also register themselves with this authority.
2. It makes mandatory the disclosure of all information for registered projects like details of promoters, layout plan, land status, schedule of execution and status of various approvals.
3. It seeks to enforce the contract between the developer and buyer and act as a fast track mechanism to settle disputes.
4. Fifty per cent of the buyers’ investment has to be deposited into an escrow account that would be used only for the construction of that project.
5. The Bill prohibits a developer from changing the plan in a project unless two-thirds of the allottees have agreed for such a change.
6. Builders would be responsible for fixing structural defects for five years after transferring the property to a buyer.
7. In case builders still cause delays in transferring properties to buyers, the appellate tribunals would intervene and slap fines on them within 60 days.