Property buyers to gain as govt moves to regulate brokers
With incidents galore of property buyers getting duped by agents and brokers, the Centre is planning to make it mandatory for real estate agents to get themselves registered with the proposed real estate regulatory authority.business Updated: Jul 15, 2014 11:20 IST
With incidents galore of property buyers getting duped by agents and brokers, the Centre is planning to make it mandatory for real estate agents to get themselves registered with the proposed real estate regulatory authority (Rera).
The housing ministry also intends to expand the purview of Rera to cover commercial as well as residential real estate.
The Real Estate (Regulation and Development) Bill introduced in the Rajya Sabha by the UPA government last August covered only residential real estate. Also, it required just real estate developers — not property dealers/agents — to register with Rera.
The two changes, an official said, would “help protect buyer’s interest from unscrupulous agents and property brokers”. The bill proposes setting up of a Rera in every state.
A senior government functionary told HT that the ministry was expected to formally approve the changes to the bill “soon”, adding that a cabinet note would be moved after that.
The original bill was referred to the parliamentary standing committee, which made several recommendations in its report submitted to the housing and urban poverty alleviation ministry in February 2014.
A third recommendation to bring smaller real estate projects — coming up in plot sizes less than 1,000sqmt -under the purview of RERA was rejected by the ministry.
This would have made it mandatory for small builders to provide a host of details to the regulator — including approved layout plan, timeline, cost and the sale agreement that prospective buyers will have to sign — before it would be allowed to advertise or launch the project. Failure to do so would invite upto a maximum three years imprisonment or fine of upto 10 % of the total project cost.
“The exclusion of projects smaller than 1,000 sqmt from the purview of RERA could lead to the exclusion of a large number of small housing projects,” the panel had said.
Violation from the contractual agreement will invite upto a year behind bars or fine of upto 5% of project cost.
The bill also has safeguards for developers. Buyer’s who default on payment would also have to cough up fines.