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RERA’s Importance & Benefits: How RERA Has Changed the Real Estate Sector in India

Date - 01 Oct, 2024
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When investing in real estate, deciding which property to invest in is not easy because you need to find the right property abiding by all the laws and regulations. After all, real estate investments can eat a huge chunk of your life’s savings. However, before the RERA Act was introduced the lack of transparency and accountability had been very common in the real estate sector.

Many people came across various cases of fraud, delayed or no possession at all, project cancellations, and rising overhead costs. This made the home buyers or investors face huge losses. In many cases, the residents were required to vacate their houses after living there for years because those properties were not government-approved.

However, fortunately, the RERA Act has made things a bit easier and this act was introduced to restore the confidence of home-buyers and investors in the real estate sector. And, RERA registration is currently mandatory for every property in India. The buyers now have the authority to address any complaints about their real estate investments.

It eventually makes sure that there is more accountability and transparency and buyers can now make better-informed decisions. However, the RERA Act has impacted the real estate industry in many ways by making the builders answerable to the property buyers. Hence, RERA has been a great step taken by the government to boost investments in the real estate sector.


Let’s discuss how RERA has changed the Real Estate Sector in India in the last 5 Years –

RERA stands for Real Estate Regulatory Authority and the RERA Act was passed by the Government on March 26, 2016. However, all the provisions of the RERA Act were implemented on May 1, 2017. The RERA Act is applied to residential and commercial projects both. Here is how RERA changed the real estate sector.


1. RERA is a Standardized Method for the Calculating the Carpet Area:

Before 2016, when the RERA Act was not introduced, there was little regulation in the process of purchasing a home. There was no standard method for calculating the carpet area of a property. For instance, the calculation of the carpet area for a residential unit by one developer would be 1200 sq. ft. whereas for another developer, it could be 1000 sq. ft.

However, the implementation of the RERA Act brought a standardized method for the builders to calculate the carpet area of their properties. The formal definition of a Carpet Area under the RERA rules says that the Carpet Area is the net usable floor area of an apartment (excluding the area covered by external walls, areas under service shafts, external balconies or verandah areas, and open terrace areas).

However, the carpet area can include the area covered by the internal partition walls of an apartment. Well, this exact calculation of the Carpet Area has directly impacted real estate prices across the country while reducing fraudulent practices. If you’re looking for the best Project in Delhi NCR which is also RERA-approved, then check out M3M Capital Dwarka Expressway, Gurugram.


2. All builders are required to register their projects under the RERA Act:

After the implementation of the RERA Act, the Indian Government has made it mandatory for all real estate builders in the country to register their properties under the RERA Act. However, while registering under the RERA Act, the builders are required to provide all the proper details of the property, which include –

  • The estimated handover date
  • Floor plans etc.

Moreover, all RERA-approved projects are listed on the state government’s official website and all of them are provided with unique RERA registration codes. So, if you’re a homebuyer or looking for an investment opportunity, then you can visit the RERA website to find the details of specific properties.

For example, if you’re interested in buying a house in Noida, Greater Noida, or another city in Uttar Pradesh, then you can visit the UPRERA website and browse the details of the property you’re going to invest in. Well, this helps immensely in simplifying the process of home buying in India. One of the projects you can check the details about on UPRERA is Godrej Tropical Isle Sector 146, Noida.


3. Builders are required to provide updates on construction to homebuyers:

Under the RERA Act, a builder is required to provide regular updates on the construction status of a project to the homebuyers who have already invested in that particular project. Not only that but builders are also required to update the construction status of their projects.

The builders are also abided to upload the details on their websites including how many flats in a project are sold so far and the price value of each flat, etc.

Such an arrangement helps homebuyers make informed decisions when buying a property. Also, it helps those who have already invested in a property as they can stay updated about the construction of their house.


4. RERA ensures timely delivery of projects:

One of the best things that changed after the implementation of the RERA Act is that this ACT forces the builders to provide timely possession of the properties. However, if a builder fails to complete the construction on time for the RERA-registered project then they may be levied a penalty to the government and may even face imprisonment.

Not only that, but the builders also have to pay interest to the homebuyers as per the RERA rules. Hence, the RERA Act has helped in eliminating a big problem faced by homebuyers i.e., unruly delay in the handover of the under-construction projects.


Wrapping Up

While wrapping up, we would say that the real estate industry has seen several changes over the years in terms of rules and regulations. However, the RERA Act controls and regulates the Indian real estate industry. The RERA Act has indeed ushered in more transparency and accountability in real estate transactions which has encouraged more investment in the real estate sector. With RERA, investments in the real estate sector in India will no longer be risky. Some of the projects that you can consider for buying your next property are Conscient Parq and Emaar Urban Oasis.