What is RERA? Know all about RERA

Mouna May 12, 2022

Many of us have wondered, What is this RERA? Is it necessary to purchase a home? What is the procedure for applying? What types of projects are covered by the RERA? There are numerous inquiries. Lets take you on a virtual tour of RERA to answer all of your questions.

RERA stands for Real Estate Regulatory Authority came into existence as per the real estate(Regulation and Development) Act, 2016. RERA aims to cut down on project delays and fraud. RERA will ensure greater precision between developers and buyers, resulting in greater transparency.

Why RERA is needed?

RERA committees have been established across India to promote uniformity, transparency, and regulation of the real estate sector, as mandated by the RERA Act of 2016.

With RERA in place, every builder or developer is required to keep homebuyers informed about the progress of their project, provide them with keys to their property by the specified date and follow all RERA rules to ensure accountability.

Projects that comes under RERA

RERA applies to all real estate projects once all states and union territories have complied with it. When a project falls under RERA, however, the following conditions must be met:

RERA applies to projects that were completed prior to the RERA Act's implementation but do not have a completion certificate.
Construction projects, on the other hand, must maintain a report for each phase of construction as a separate project through a new RERA registration.
The RERA Act does not apply to projects that are under construction for renovation/repair/redevelopment and are not re-allocating, marketing, advertising, selling, or allocating any apartments, plots, or buildings.

Key benifits offered by RERA

RERA has impacted every aspect of the real estate industry in the following ways:

It has increased real estate developers confidence in investing in projects, resulting in increased investment. Both residential and commercial properties are subject to RERA regulations.
Under RERA, Builders must disclose every detail of their project on RERA's official website. They must also keep the information on the website updated on a regular basis. This also ensures that buyers are aware of project deadlines.
RERA regulations require buyers to pay for a home based on the carpet area or the area enclosed by walls. Builders are thus prohibited from charging homebuyers for the super built-up area, which includes balconies, elevators, stairs, and lobbies.
Builders are not allowed to charge the buyer more than 10% of the project's cost as advance or application fees under RERA.
Builders must deposit 70% of the money from homebuyers into a separate bank account that will only be used for construction. As a result, buyers can stay assured that their funds are safe and that the use of their funds is transparent.
Homebuyers have up to five years after receiving a handover to report construction defects and ask developers to fix them. Developers must resolve registered disputes within 120 days under RERA.
Every state's RERA is divided into several smaller regulatory bodies that are responsible for the development of the real estate industry in that state or union territory; this ensures greater transparency and makes business transactions easier.

How to register projects under RERA Karnataka

Follow the steps outlined below to register your project under RERA.

Every real estate agent in the state of Karnataka is required to register with the RERA. It could be at the level of an individual or an entity. Here's how it works:

Step 1: Visit rera.karnataka.gov.in and click on “agent registration”.

Step 2: Choose individual or business entity and enter your email id.

Step 3: Fill the details such as personal information and area of operation. Upload all the necessary documents including an affidavit.

Step 4: Pay the RERA registration fees to complete the registration process. This amount varies from state to state.

Step 5: Wait for the RERA registration number to be alloted by the authority. Once you received the RERA registration number use the same for all the future communication.

What are the penalties under RERA?

You can file a complaint with RERA as a home buyer. The developer or promoter faces a penalty for the offence you mentioned. If they are convicted, the following penalties will apply.
If promoters do not register under RERA, they must pay 10% of the project's estimated cost. Furthermore, if they are found giving out false information about the project, they will be fined 5% of the estimated cost.
Violations of the law can land promoters in prison for up to three years or cost them 10% of the project's estimated cost.
In the event of serious noncompliance with RERA, developers will be subject to a daily penalty of up to 5% of the project's probable value.
Noncompliance with the appellate Tribunal carries a penalty of up to one year in prison or a fine of 10% of the project's likely cost or the both.

As a home buyer, it is important that you choose an RERA-registered project in order to make a secure investment and avoid any potential losses. The Real Estate Regulation Authority safeguards homebuyers' and investors' interests while also improving the organisation and transparency of the real estate market. RERA regulates nearly 70% of the country's total real estate projects.