RERA rules: 10 important facts to know

The government notified the final rules to implement the Real Estate (Regulation and Development) Act, 2016 (RERA) that aims to bring transparency and set accountability in the sector and help in completion of stalled projects. The rules will be applicable for five Union territories without legislature of Andaman & Nicobar Islands, Dadra & Nagar Haveli, Daman & Diu, Lakshadweep and Chandigarh.

Here are the key points you should know about:

  1. Pay Compensation: Developers will now be required to refund or pay compensation to the allottees for delay in projects with an interest rate of the State Bank of India’s highest marginal cost of lending rate plus 2% within 45 days of it becoming due. This would come to around 11% to 12%.
  2. Deposit Money: For the completion of ongoing projects, developers will have to deposit 70% of the amount collected and unused within three months of applying for registration of a project with the Real Estate Regulatory Authority in a separate bank account.
  3. Punishment: The rules also contain clauses providing for compounding of punishment with imprisonment for violation of the orders of Real Estate Appellate Tribunal against payment of 10% of project cost in case of developers and 10% of the cost of property purchased in case of allottees and agents.
  4. Sale of Properties: Discrimination in sale of properties on any grounds will also not be entertained under the new rules. Adjudicating Officers, Real Estate Authorities and Appellate Tribunals shall dispose of complaints within 60 days.
  5. Certification: In respect of the ongoing projects that have not received completion certificate in specified time, developers will have to make public the original sanctioned plans with specifications and changes made later, total amount collected from allottees, money used, original timeline for completion and the time period within which the developer undertakes to complete the project.
  6. Carpet Area: Promoter shall also declare size of the apartment based on carpet area even if it was earlier sold on any other basis.
  7. Registration: For registration of projects with the authorities, developers will be required to submit authenticated copy of PAN card, annual report comprising audited profit and loss account, balance sheet, cash flow statement and auditors report of the promoter for the immediate three preceding years, authenticated copy of legal title deed, copy of collaboration agreement if the promoter is not the owner of the plot. Promoter also has to declare information regarding the number of open and closed parking areas in the project.
  8. Income Tax Returns: The requirement of disclosing Income Tax returns proposed earlier has been withdrawn in the final Rules keeping in view the confidentiality attached with them and as pointed out by legal experts and promoters.
  9. Fee for Registration: To incentivize registration of projects and Real Estate Agents with Regulatory Authorities, fee for the same has been reduced by half based on suggestions from promoters for reduction of fee.
  10. Information about Details: To enable informed decisions by buyers, Real Estate Regulatory Authorities will ensure publication on their websites information relating to profile and track record of promoters, details of litigations, advertisement and prospectus issued about the project, details of apartments, plots and garages, registered agents and consultants, development plan, financial details of the promoters, status of approvals and projects etc.

Sources – www.realty.economictimes.indiatimes.com/slide-shows/rera-rules-10-things-to-know-about/55156347

Size of Real Estate Market to grow to USD 650 billion by 2040: Niti Aayog

New Delhi

Indian real estate market is expected to jump over fivefold to USD 650 billion by 2040 and its share in the country’s gross domestic product (GDP) is set to double from the current seven per cent, Niti Aayog Vice-Chairman Rajiv Kumar said Friday.

“The government is committed not only to real estate sector but all aspects of it. The government is very conscious and cognisant of what happening in the sector and how it contributes to the economy,” he said while addressing a global luxury realty conclave organised by India Sotheby’s International Realty.

Kumar said the recent Interim Budget has demonstrated that the government would take steps to make sure that the real estate sector grow and develop further so that this industry contributes even more to the economy.

The Centre has offered a lot of tax incentives to developers building affordable houses and also tax sops to homebuyers looking to purchase second homes.

Highlighting the importance of this sector, the Niti Aayog vice-chairman said the real estate sector is contributing seven per cent to the country’s GDP and its share is expected to double by 2040.

The current size of the real estate market is already USD 120 billion dollar and this will grow to USD 650 billion by 2040, he said, adding that the industry employs 55 million people now and this number will rise to 66 million as it grows.

“This sector is heart of the economy. It has backward linkages with 200 other industries,” Kumar said.

He also said the real estate sector would contribute more with rapid urbanisation.

Kumar said the two legislations — the goods and services tax and the RERA — implemented by the government would help in organised growth of this sector.

He asked real estate companies to blend best of Indian culture and best of global facility and technologies in their future development of properties.

Speaking on the sidelines of the event, Embassy group President (Residential Business) Reeza Sebastian said there is a good demand for completed housing units in all categories including luxury homes.

Tata Housing Managing Director and Chief Executive Officer Sanjay Dutt said the demand for luxury houses is slow and this has given an opportunity to better our product portfolio in terms of design and other services.

Colliers International National Director Gagan Randev said: “Luxury real estate market has become much more discernible with a preference in most markets for gated communities offering a luxury lifestyle. Developers are differentiating their high end products and this has resulted in success of branded residence.”

Gaurs Group MD Manoj Gaur said the luxury housing is looking up and its demand is growing because of a growing number of high networth individual in the country.

Amit Goyal, CEO of India Sotheby’s International Realty, said this is the third edition of global luxury real estate conclave, which provides a platform where all the stakeholders come together to discuss the ever-changing luxury property market.

India Sotheby’s International Realty is part of the of US-based Sotheby’s International Realty, which operates a global network of over 22,000 affiliates with 970 offices across 72 countries, dealing in luxury real estate properties.

Sources – www.realty.economictimes.indiatimes.com/news/industry/size-of-real-estate-market-to-grow-to-usd-650-billion-by-2040-niti-aayog/68114021

Changes in RERA need of hour to achieve growth: Madhya Pradesh RERA chief

Indore

With changing times, lot of technical advancement is happening in real estate sector and maximum utilization of the advancements will set the direction of real estate sector, said head of MP Real Estate Regulatory Authority (Rera) on Friday. “These changes or technical advancement may be a challenge for developers but need of the hour to accept these changes to achieve growth,” Rera chairman Anthony De Sa said on Friday at a seminar on ‘Amendments in RERA’ conducted by Institute of Chartered Accountant Indore branch.

De sa said the aim of Rera is to ease and smoothen real estate market by bringing transparency and responsibility.

Addressing realtors and chartered accounts, he said, “Through Rera, we aim to increase investment in real state sector and protect rights of consumers. Higher investment in the sector will help in recovering from the tough phase.”

Rera chairman said chartered accountants also play an important role in ensuring the norms are followed and true documents are submitted by developers. He said a new format for developers report has been drafted by authorities after suggestions from chartered accountants.

“The pace of any project will be monitored on basis of quarterly return that shall be attested by chartered accountant,” said De Sa.

In Rera, audit of accounts is mandatory for developers. He said as per Section 4(2), it is the role of chartered accountant to check that money received from a particular project is spent only on that project and debit from the account is in accordance with site expenses.

CA should collect all information about project well in advance from developer before handing over certificate to authorities. Institute of Chartered Accountant Indore branch chairman Abhay Sharma said, “Rera has been implemented since past 21 months but still there is lack of awareness. For smooth implementation of real estate act it is important that people are fully aware of their rights and role of Rera that it plays in regulating real estate market.”

Over 1,000 developers keep dodging Karnataka RERA notices

Karnataka

With over 1,000 real estate projects in the state not registering with the Real Estate Regulatory Authority (RERA) and their proponents not responding to repeated notices, the authorities are in a fix.

The Karnataka-RERA secretary wrote to the Confederation of Real Estate Developers Association of India (Credai), requesting it to facilitate the registration of unregistered projects by encouraging promoters/developers to appear before the Authority.

Referring to the 1,076 projects “under investigation”, which have been identified by RERA for not having registered with the body, the authority’s secretary said not only have the projects’ proponents not responded to the notices, they have not explained the reason for not registering with RERA as per the provisions.

A majority of these projects are in Bengaluru.

“Despite issuance of several notices by RERA, only a few promoters have come forward and registered and a very few promoters have submitted their explanation claiming exemption under the provisions of the Act and rule but have failed to produce relevant documents before the Authority,” RERA secretary Latha Kumari K S wrote in the letter.

She asked the Credai-Karnataka president to support the implementation of the RERA Act and rules in letter and spirit. In his reply, Credai vice president Suresh Hari wrote: “All Credai members have registered under RERA and it is only the small builders who are out of the confederation who have stayed out. So there is nothing that we can do to get them registered.”

Activists who are fighting for the effective implementation of RERA have questioned the authority for not initiating action against these projects “under investigation” and for following a wait and watch policy. “RERA can verify the plan approval sanctioned to projects that are under the scanner. They can even freeze their bank accounts,” said M S Shankar, a RERA activist and the secretary of Fight for RERA-Forum for People’s Collective Efforts.

RERA authorities say it is a herculean task to track project promoters. “Often their registered offices do not exist or emails bounce back. In several cases, there is no way we could find out and track the promoter. RERA cannot initiate penalty provisions without giving the project proponent an opportunity to present the case,” said Kumari.

RERA believes that several of the projects under investigation could be older projects which got approvals and commenced before RERA came into existence.

Sources – www.realty.economictimes.indiatimes.com/news/industry/over-1000-developers-keep-dodging-karnataka-rera-notices/67991556

MahaRERA allows builders a second chance if homebuyers agree

Maharashtra

The Maharashtra Real Estate Regulatory Authority has decided to give developers a second chance to complete delayed projects after the usual extension of a year, provided over 50% customers of the property concerned agree to it.

Vasant Prabhu, the Maharashtra Real Estate Regulatory Authority (MahaRERA) secretary, said an order was issued last week to give genuine developers a second chance to complete a stalled project if the consumers were willing to wait. He said, “The extension is subject to consent of more than half the flat buyers and a time-frame would be set.”

Prabhu said, “We were getting complaints of delay in project execution. With this order, consumers can take a call on if they want to continue with the project. If more than 50% consumers agree, we can give an extension to the developer.”

Nearly 90% of the complaints registered with the MahaRERA are regarding delay in execution of projects. State president of Credai Shantilal Kataria said the order would not only benefit the consumers, but also the developers.

“It is neither easy for a consumer nor a developer to cancel a project. Given more time, genuine developers will complete projects within the time-frame decided by both the parties,” said Kataria.

The real estate sector faced a rough patch in the past two-three years. It is slowly on the recovery path. Property consultants closely monitoring the market stated that the real estate sector was set to grow this year.

“The issue of stalled projects and liquidity crisis continued to confound the housing sector last year though it continued its transition into a relatively more transparent and end-user driven market,” said Anuj Puri, chairman of Anarock Property Consultants. He added that builders were extremely cautious about launching new projects to align supply with the existing buyer demand.

Mumbai Grahak Panchayat (MGP) – the consumer forum taking up the issues of MahaRERA from the inception-welcomed the move of giving a say to the consumers but stressed that the authority should have specified that the “association of allottees” should be appointed after 50% booking of flats in a project was done.

Sources – www.realty.economictimes.indiatimes.com/news/regulatory/maharera-allows-builders-a-second-chance-if-homebuyers-agree/67985471

Tamil Nadu RERA chief (Chairperson) appointed

Chennai

After an inordinate delay, the state government has appointed K Gnanadesikan chairperson of the Tamil Nadu Real Estate Regulatory Authority (TNRERA). The state made the appointment more than a year after the regulatory body was set up.

Gnanadesikan will take over the duties from S Krishnan, secretary of the housing and urban development department, who was also serving as the interim chairperson of the regulatory body.

S Manohar, engineer-in-chief, buildings, public works department and V Jeyakumar, advocate have been appointed as its members. N Balasubramanian, retired district judge, as its judicial member and Leena Nair, retired IAS officer, as the administrative member of the tribunal.

TNRERA was set up in June 22, 2017 with an aim to protect the interest of home buyers. According to the Real Estate (Regulation and Development) Act, 2016, every state government must establish a real estate regulatory authority within one year from the date of the Act coming into force through a notification. The body must consist of a chairperson, and not less than two full-time members.

However, since its establishment no appointments were made in Tamil Nadu.

The state also defied an order of the Central Advisory Council, which monitors the implementation of RERA, directing authorities to appoint a permanent regulator by June 30. While the state has finally appointed a new chairperson, he is due to retire in April.

The chairperson of TNRERA is vested with powers to direct and discharge administrative functions and address and dispose grievances of homes buyers. The members of the authority can only assume office after the chairperson has.

Sources
1. www.realty.economictimes.indiatimes.com/news/regulatory/tamil-nadu-rera-chief-appointed-after-more-than-years-delay/67910824
2. www.newindianexpress.com/cities/chennai/2019/feb/09/k-gnanadesikan-new-chairman-of-real-estate-regulatory-authority-1936448.html

Home Inspection Industry – Seeds starting to bloom

RERA Updates

  • A Brand New concept was launched for the First Time in India couple of years back by 5 – 6 mavericks simultaneously having started, home inspection services.
  • Leading professionals (from IIT / IIM / Google / SAP / Wharton / ICAI) launch the home inspection services across major Indian cities including Kolkata, Mumbai, Bangalore, Gurgaon, Delhi, Pune, Chennai, Navi Mumbai, Goa, Kohima, etc.
  • These companies include MACJ – A Buyers Choice Home Inspections, HomeInspeKtor, E-ghar, Checkmyprop, Nemmadi, meazurement, etc.
  • All these companies have now come together and formed the “Home Inspection Association of India”, a milestone achieved in the country.
  • The Association has been formed with the objective to have a common platform for the growth, development & regulation of Home Inspection Industry in India with the objective of ensuring Healthy and Safe Homes.
  • This development has major significance in the background of RERA (Real Estate Regulation & Development Act) being enacted to promote Transparency & Efficiency in the sale of Real Estate projects and to protect the interest of Home Buyers in the Real Estate Sector.

Visit: www.macj-abuyerschoice.com/welcome-to-the-sunshine-industry-professional-home-inspection-services/

MahaRERA Strives to encourage greater accountability, transparency and trust in the Real Estate Sector

MahaRERA Updates

  • Project Registration Status
    • Projects Registered but not completed: 15796
    • Projects Registered and completed: 3587
    • Projects yet to be Registered: 109
  • Realtor Registration Status
    • Registered Realtors: 17980
    • Realtors yet to be Registered: 186
  • Complaint Disposal Status
    • Complaint Received and disposed: 3422
    • Complaint in process of hearing: 2108

MahaRERA website: www.maharera.mahaonline.gov.in

Projects & Realtors Registration status under WBHIRA

WBHIRA

  • Registration of Real Estate Project with West Bengal Housing Industry Regulatory Authority (WBHIRA) is compulsory under U/s 3 West Bengal Housing Industry Regulatory Authority (WBHIRA) Act.
  • Total number of Registered Projects in West Bengal under WBHIRA Authority – 340.
  • Out of which Registered Projects in Kolkata under WBHIRA Authority – 102.
  • Total number of Registered Realtors in West Bengal under WBHIRA Authority – 138.
  • Out of which Registered Realtors in Kolkata under WBHIRA Authority – 96.
  • WBHIRA Website: www.hira.wb.gov.in