‘Let real estate law come into force before buying homes’
According to the act, the state governments will now have to frame rules for the act and constitute the Real Estate Regulatory Authority (RERA), the regulatory body with which developers have to register their projects.
With the festive season in full flow, private developers have started making attractive offers to prospective home buyers that range from cars at discounted rates, but consumer rights organisation Mumbai Grahak Panchayat (MGP) has appealed to citizens to put off their plans to buy home for the next couple of months until the state notifies the Real Estate (Regulation & Development) Act widely known as RERA Act 2016.
The act cleared by Parliament in May 1, 2016 is awaiting the rules to be notified by the state government. The press release issued by MGP says, “It may take another couple of months before the act comes into full force. And such a short wait will be worthwhile, looking at the advantages RERA offers against the risks involved by booking the homes based on deceptive offers from developers.”
According to the act, the state governments will now have to frame rules for the act and constitute the Real Estate Regulatory Authority (RERA), the regulatory body with which developers have to register their projects.
It further says that no builder will be allowed to promote, advertise or market his project until it is registered with the regulatory body. Further, no registration of the project is possible until it has all the requisite permissions from the competent authorities like municipal corporations.
The developer will have to also display the registration number in all advertisements and put the details of their project on the regulator’s website. Moreover, he has to deposit 70% of the amount received from the flat buyers in a separate account and builders are prevented from charging any exorbitant interest rate to flat purchasers in case of delay in their payments to the builder. In case of delay in getting possession of the property, the builder will have to pay an interest to the buyer interest at the prescribed rate.
“The home buyers should make it clear that their objective is to buy house or property and not get the freebies. So we are asking them to wait for few more months before making any hasty decision,” said Varsha Raut, head of advocacy and campaign of MGP.