Now it’s a tough time for those builders and developers who gives you false commitment, show misleading advertisements, making delay in completing projects. In the recent move by cabinet where it cleared the Real Estate (Regulation & Development) Bill that will go a long way in safeguarding property buyers interest from land sharks. This bill has stringent provisions to deter builders from putting out misleading advertisements related to the projects carrying photographs of the actual site. It also makes it mandatory for developers to launch projects only after acquiring all statutory clearances from relevant authorities.
The Bill proposes that developers register their projects with state regulatory authorities by declaring their building plans, timeline and other details of a project. This will then be posted on the regulator’s website. This rule would now make the concept of super area which is often used to mislead owners virtually non-existent. Remember, commercial real estate, however has been kept out of the ambit of the bill.
Lakhs of unorganised property agents have also been brought under the purview of the authority. Here the developers/builders must get themselves registered with the Real Estate Regulatory Authority to be set by respective states. All such builders developing a project where the land exceeds 1,000 sq metre will have to register themselves with the authority before launching or even advertising their project. Not doing so will invite up to a maximum three years imprisonment or fine of up to 10% of the total project cost. However, the penalty won’t be imposed on first-time defaulters.
If you are a buyer, you might want to how this bill going to help you when it becomes a LAW;
1. Developers can launch projects only after getting all relevant clearances rom the authorities.
2. No pre-lauch sales be done by these developers without the regulatory approvals.
3. Authorities have 15 days to approve or reject a project.
4. Construction to begin only after the developer’s website has displayed all details of the project including receipt of clearances.
5. The buyers are entitled to full refund with interest in case of delay in projects.
6. Realty developers will have to maintain a separate bank account for every project to ensure funds raised for one project is not diverted.
7. It will be mandatory to keep 70% of the buyers’ funds in a separate bank account to ensure timely completion of projects.
8. Developers cannot take more than 10% of the advance from buyers without a written agreement.
9. Builders will have to use photographs of actual site for advertisements purpose. Failure to do so will attract a penalty which may be up to 10 percent of the project cost.
10. Repeat offence could land the developer/builder in jail.