Investing in residential property has its own perks. Not only does it provides you with a roof above your head, but also gives you a regular source of rental income if you decide to let it out.
Moreover, you can enjoy the capital gains on selling it at a higher price in the future and enjoy regular income in your ripe years by availing a reverse mortgage on it.
However, residential property investments pose risks such as late possession and defects in construction, which are often out of your control and can cost you both income and time.
To protect homebuyers like you, the government introduced RERA, the Real Estate (Regulation and Development) Act, with an aim to eliminate the risks involved and inculcate more transparency within the property sector.
Learn more about RERA and how it benefits homebuyers below.
What is RERA?
RERA came into effect on May 1, 2017, and regulates real estate projects in India as per the rules framed by the central government.
Based on these rules, the state governments notify their own rules under the Act and oversee all developments. RERA aims to protect the interests of homebuyers and hasten the redressal time of any disputes.
It also deals with delays in project delivery, pricing, construction quality, and other issues pertinent to the property sector in a transparent and fair manner.
How will RERA impact homebuyers?
RERA only impacts homebuyers positively as it makes it mandatory for all real estate projects to be registered with the RERA of the state they are being developed in. Here are the benefits of RERA for homebuyers.
- RERA takes steps against project developers who default on the timely delivery of the project or possession of a house. It charges developers an interest rate of 2% above the home loan interest rate offered by the SBI. A developer may also face imprisonment for up to 3 years for offering late possession.
- Earlier builders charged on the super built-up area and not carpet area of a home. Now, RERA specifically defines the ‘carpet area’ and insists that sellers price property based on it. This way, you no longer have to pay excess charges.
- RERA provides a defect liability clause that holds developers liable for structural defects in the construction. You can claim such defect liability for 5 years from the date of possession under Clause 14 (3) of RERA Act. The developer is also directed to address your claim within 30 days from you filing the complaint.
- As per RERA, each state will have separate appellate tribunals and regulatory bodies to address disputes between you and the builder. RERA assures that disputes will be addressed within 120 days of parties bringing it to notice.
- RERA mandates that developers only sell projects that are clear of any legal disputes. The registered developers are liable to disclose every single detail about the project to enjoy clearances from RERA. Also, developers have to register advertisements and promises under their RERA registration number and deliver on all such assurances without fail.
- RERA also mandates developers to inform homebuyers who have booked or paid for a property about any additions or alternations in the plans and seek the consent of at least 2/3 of all those who have been allotted plots or homes before proceeding. This allows homebuyers to be in the know and have their say as well.
With RERA in place, you no more have to worry about the risks posed by investing in a residential property. Just make sure that you invest projects registered with RERA. For instance, if you are looking to invest in real estate in Bangalore, consider RERA-compliant projects like Provident Park Square Phase 1, Sobha Dream Acres, and others. These properties also offer ample facilities and luxurious living at affordable costs.
Whether you are looking for property in Bangalore, Mumbai or any other city, you can search for the ideal residential property with reputed online real estate portals such as Bajaj Finserv Homes and Loans. Here you can also find high-value loan sanctions and other services to make your home purchase a delightful experience. Avail Bajaj Finserv Home Loans of up to Rs.3.5 crore at affordable interest rates here. Additionally, you can also benefit from easy documentation and property dossier services that help you stay updated with the financial and legal aspects of buying a home. Start now and check your pre-approved offers to expedite your financing.