Real estate had been a very unregulated sector in India in the past. This sector had no such regulative acts which checks the dealing of the assets, to make it fair and efficient. The unavailability of regulations led to lots of frauds and monopoly from the builder’s side. Buyers have been facing loss in this sector since long. Delay in getting the possession of their property, EMI loads and rental problems are some of the problems that the buyers were facing before the RERA act.
Not just the buyers, but the agents and builders were also on the loss facing trap. Due to the downfall in the sentiments of the buyers in this sector, the market was really going down. In the past 4-5 years, the real estate sector had gone quite low.
The RERA or Real Estate Regulation and Development Act has come up as a boon for the buyers on the real estate industry. The RERA act is a central act, which contains the model guidelines made by the central government. This act was notified for the first time in 1st May 2016 and has come into full force from 1st may 2017. This act is applicable in every states and union territories of India except for Jammu and Kashmir, Kerala, West Bengal, Arunachal Pradesh, Mizoram, Meghalaya, Sikkim, Nagaland have not notified the Rules. In the case of five north-eastern states, the RERA Act is facing certain constitutional challenges as the land in those states are community owned.
This act is applicable only for underconstruction real estate properties.The main objective of the RERA act is the regulation and promotion of the real estate sector, protection of the interest of buyers and to build a speedy dispute redressal mechanism.
Every state of India is guided to make the rules and regulations in the real estate sector according to the act. Most of the states are already acting upon this and they have made their own Real Estate Regulatory Authority, together with it every state should have a tribunal, which is a small court which will handle the matter in any kind of disputes.
The Real Estate (Regulation and Development) Act, (RERA) is bringing about a well transformed and regulated system in the Indian real estate market. It has made the future of the Indian real estate sector secure. This implementation promises the buyers safety and financial discipline. The reforms can make it a stage of struggling for the builders, however it is a boon for the buyers and the ideal time to purchase a property has just knocked the door. The prices of the prope rties have dramatically come down in most parts of the country.
The total real estate market is in the buyers side this time. After the act has been implemented, there is a list of unsold properties which has led to an excess in supply. There also are many ongoing projects, completion of which will lead to further decrease in the prices. Because of these facts, the buyers are currently in a very strong negotiating position.
The situation has compelled the builders to come up with various discounts and offers, including free parking spaces and other facilities.
Buyers are not willing to take risks by investing in under construction projects, which has led to a growth in the sales of ready to move in houses by 10% to 12%.This seems to be the correct time for the buyers to invest on ready made properties, further GST has also been removed from ready to move in houses and lands.Due to the several complaints from the buyers that the real estate transactions were in favour of the builders, the RERA act has come to existence. The implementation of this act has increased the buyer’s confidence and has brought transparency in the system. This progressing act promises a positive future of real estate for the buyers.