Category: HI & RERA

Pune

The Maharashtra Real Estate Regulatory Authority (MahaRERA) has reduced the minimum registration fees from Rs 50,000 to Rs 10,000 for projects that will enable smaller units, especially in the rural areas, to come under its purview.

The change has been effected in accordance with the amended rules issued by the Maharashtra Housing Department on June 6, MahaRERA officials said.

With the prescribed rate of Rs10 per square metre and the minimum area of plot under RERA being 500 square metre, the minimum charge reduction would ensure that developers with smaller projects are encouraged to register with MahaRERA and no longer pay a blanket charge of Rs50,000, the officials said.

“Many cities, other than the metropolitans, have several small projects that may be spread over a little more than 1,000 sq metre or 1,200 sq metre. If these developers had to register their projects, they would have to pay Rs50,000 irrespective of the area. But the reduced minimum charges would encourage such developers to come forward and register their projects,” a senior MahaRERA official said.

MahaRERA completed two years of its implementation in May this year. The officials said over 21,000 projects have been registered in the state, the maximum in the country. Following this, the authorities have taken initiative to ensure more registrations and have more developers under MahaRERA’s purview.

“In the first and second year of the implementation of the rules, it was noticed that most of the registrations came from the Mumbai Metropolitan Region (MMR) and from cities such as Pune and Nagpur. Not many registrations came from the rural areas of the state. This year, our main focus is to penetrate into these areas,” the MahaRERA official said, as he elaborated the need for the amendments.

The changed rules have also reduced the fees for plotted developments, a move that will bring more projects from the rural areas under MahaRERA. In case of plotted development, the promoters have to pay an extended fee calculated on the area of the land proposed to be developed at the rate of Rs5 per sq meter.

Consumer forums, which have been urging MahaRERA to go ahead with these amendments, said the recent changes in the rules regarding registration of projects were done keeping in mind the ground realities. “Till the other day, the rules had not defined plotted development though RERA also covered plotted developments. Through this amendment, the definition of the plotted development has been added to the MahaRERA rules,” Mumbai Grahak Panchayat president Shirish Deshpande said. He added that bringing down the rate for plotted development from Rs10 to Rs5 per sq metre was “realistic”.

Besides, the conveyance to be done by the promoter is within three months since the arrival of the occupation certificate. The amended rules do not give the developers any options for delay.

“The earlier rule stated that the promoters have to give conveyance once 50% of the homebuyers paid full consideration or within one month from the formation of the society or within three months from the date of occupancy certificate, whichever earlier. This was impractical. The MGP had taken this up with the authorities while framing the original rules. But it was not considered then. However, the amended rules state that the conveyance has to be done within three months from the date of occupation certificate. It makes sense,” Deshpande said.

Confederation of Real Estate Developers Association of India, vice-president Shantilal Kataria said the reduction of minimum fees for registration will benefit the tier two, three and four cities and encourage more developers to register with MahaRERA. He, however, said the conveyance period of three months should have been six months.

Source: www.realty.economictimes.indiatimes.com/news/regulatory/minimum-registration-fees-down-by-maharera-rural-areas-to-benefit/69765872

Amendments made to the Maharashtra RERA rules stipulate that real estate developers can no longer claim expenses made on advertisements and promotions, as well as brokerage commissions as part of their construction costs.

According to RERA regulations, developers are required to deposit 70 per cent of the funds collected from home buyers in a separate RERA account. These funds can only be withdrawn for construction with appropriate certification from the architect and the chartered account. This was done to check the practice by developers to collect booking amounts and flat sales from home buyers and moving them to another project, often stalling the first project.

“The development cost or cost of construction of the project shall not include marketing and brokerage expenses towards sale of apartments. Such expenses though part of the project cost should not be borne from the amount that is required to be deposited in the designated separate account,’ said a notification issued by the state housing department on June 6.

‘Developers often show expenses for full-page ads also in this account. Now, those marketing expenses have to be shown in the remaining 30 per cent. For home buyers, it means that more money will available for completion of housing projects,’ said Gautam Chatterjee, chairperson, MahaRERA.

The notification has also reduced the minimum fee that developers need to deposit with MahaRERA at the time of registration of a project from Rs 50,000 to Rs 10,000 for plotted developments. Earlier, developers had to pay between Rs 50,000 and Rs 10 lakh as per the area of the land proposed to be developed at the rate of Rs 10 per sqm. Now, for plotted development, the registration fee will be calculated at the rate of Rs 5 per sqm.

The notification also gives brokers and real estate agents an opportunity to lodge complaints with MahaRERA against developers if their commission or fee was unpaid. “If there is a broker or real estate agent involved in the transaction between the developer and a home buyer, then his commission or brokerage from developer’s side or the buyer’s side should be paid to him as per agreed terms of payment. We have now included this in the RERA’s model form of agreement and brokers can lodge a complaint with MahaRERA and the authority will give them a hearing,’ Chatterjee said.

The new rules received mixed responses from the construction industry. While it was agreed that the amendments were consumer-friendly, questions were raised on the impact they have on incomplete projects.

Reacting to the amendments, Rohit Poddar, Managing Director, Poddar Housing and Development Ltd said, ‘The decision to eliminate the marketing and brokerage expenses from the cost of development is a good move from a consumer’s point of view. However, it should be subject to scrutiny whether it will have any direct impact on the prices for end consumers. Advertising, marketing, and brokerage costs are a part and parcel of the project cost, and it is recommended that they are included in the project cost, especially for the affordable segment.’

Rajan Bandelkar, President of National Real Estate Development Council (NAREDCO), Maharashtra said, “The amendment is likely to impact the unsold inventory. How does the developer sell these without including the marketing costs in the construction cost?”

Ameya Tandulkar, Chief Operating Officer at Paradigm Realty said, ‘The RERA Act clearly mentions that marketing costs should not be included in the 70 per cent funds meant for construction. This account was always meant to pay for land cost, construction cost, premiums for fungible FSI, and administrative costs incurred by the developer. I think the amended rule only reiterates that developers should not include marketing costs.”

Amit Wadhwani, Co-Founder, Sai Estate Consultants Chembur Private Limited (SECCPL) said, “RERA is definitely paving the way for a transparent sector.”

Source: www.realty.economictimes.indiatimes.com/news/industry/maharera-no-advertisement-expenses-in-construction-costs/69781792

Maharashtra Real Estate Rules 06.06.2019