Rera Filing

Slow pace of RERA in Rajasthan - Only 3 projects registered till date Dated on:  Thursday 29th June 2017 RERA came to force in Rajasthan on 1st June 2017 since then only 3 projects and 11 real estate agents have registered in RERA in last 27 days. There are around 300 new and 1000+ ongoing projects in the state but despite the fact pace of registration is very slow. All developers in the state have 90 days from the date of authority came into the picture and looking at the current pace it seems difficult for the authority to register all projects on time.  One of the main reason of slow pace of registration is the compliances which were imposed on a particular project. "The developers have to provide details on 49 points, which are mentioned in the registration form. The process was complex and it requires two- three days to collect substantial documents for one point. Demand was made to simplify the process, so that we can start the marketing of our projects after re

Himachal Pradesh to notify RERA in monsoon conclave Dated on:  Saturday 1st July 2017 RERA is applicable in India from 01 May 2017. The act applies to both residential and commercial property .State urban development, town and country planning minister Sudhir Sharma said that draft rules have already been prepared and will be placed in the assembly during the monsoon session for approval. Several states have already notified the rules though.The act in Himachal Pradesh will bring more transparency and will boost buyer’s confidence in real estate. RERA rules mandates registration of every real estate project with authority.After notifying the rules the state will form an authority for RERA registrations. Many states have already notified their RERA rules.

MAHARERA issues a clarification in relation to Separate Bank account Friday 30th June 2017 Author:  Riya Kapoor Highlights The amount in a separate bank account can be withdrawn only after a certificate of an Engineer, architect and a practicing chartered accountant Only interest payable to financial institutions, scheduled banks, Nonbanking Financial institution(NBFC) or money lenders on construction funding or money borrowed for construction should be added to the cost of construction For every phase of the project , separate registration needs to be obtained and thus separate bank account needs to be maintained Real Estate (Regulation & Development) Act 2016  has been implemented in entire India from 01 May 2017. As per the RERA act, promoters are required to maintain a separate bank account for every project in which 70 % amount collected from allottees will be deposited. Funds deposited can only be utilized for land cost and construction co

Tamil Nadu notified RERA regulation secluding projects which are on the verge of completion. RERA to be functional with immediate effects in the state. The Penalty of 10% of the project cost to apply and imprisonment of about 3 years on law violation. 22nd of June rules have been notified in the state. Project under Chennai Metropolitan Area (CMA) on their completion are to be exempted from the law. Completion certificate issued by the Chennai Metropolitan Development Authority (CMDA). Projects not listed with CMA completed their construction and certified with the architect or structural engineer/ licensed surveyor linked with the project aided with photographs to range outside RERA.

After the passage of 7 weeks, only 72 projects approved under RERA with around 88 applications received so far. Developers cautious Rajesh Prajapati, Chairman, PR, and Media Committee of the Confederation of Real Estate Developers’ Association of India (CREDAI), said, “It takes time for the market to digest any new rules. In this case, not only do we have to upload our financial documents but also the carpet area as per RERA norms. There is no scope to make mistakes and hence the developers are being cautious. All the developers are currently busy getting all the systems in place. We still need clarity from the regulator on a number of aspects.” When Chairman was asked about his verdict over the pace of registration, “It is essential to register before July 31 and we expect a spike in registrations next month, with at least 35,000-40,000 projects applying for registration by the end of July.” Transparency Pankaj Kapoor of Real Estate Research firm says about the pace of th

Centre government leaving no stone unturned to bring up the RERA implementation in states to bring transparency and liability in real estate sector. Centre prohibited constructions and marketing of projects unregistered with RERA. This calls for urgent implementation of the RERA rules in the state. Developers not allowed to do business for being unregistered. March 1, 2017, was the deadline for the registration and State seems to be unresponsive to it. 16 states along with UTs inclusive of Haryana, Karnataka, and Goa have no notified rules. Only Maharashtra, Madhya Pradesh, and Rajasthan enabled online registration under the Act. States claimed under section 3(1) of the Act, the ongoing projects were given limit until till July 31/ 2017 for registration. Housing ministry stated in June no projects inclusive of ongoing ones cannot be continued without registration under RERA. Three months time given for registration of the projects if failed would fall illegal from May 1. “T

Penalties in RERA for Brokers and Builders Like financial services are governed by SEBI and it plays a very vital role in case anyone is mis-selling, Real Estate is also a financial product which is very heavy, but lacked a governing body. Before  RERA , there was no regulation for the developers’ as well as for the brokers’. This led to mis-selling to the end-user or investor and realtors and developers used to do anything and everything just to close the deal. RERA has ensured that the intermediary as well as the developer has the equal responsibility and accountability. It is not just about the financial damage, but criminal damages as well like imprisonment in case of any fraud. With RERA, a home buyer has a lot more power and authority than ever before and that is why the buyer should be fully aware of the advantages he/she is getting. For the builders and the brokers, it is an opportunity to show their work and thus give a better and transparent service. They can re-build

RERA Impact on new launches The  Real Estate (Regulation and Development) Act, (RERA) , which came into force on May 1, 2017 is surely a welcome change for industry players, buyers, and investors. While it creates a more transparent system, the other side of the Act has been a rise in the input as well as holding costs for developers. With a number of advantages that it passes to the buyers, it is also a fact that residential prices may likely rise in the coming time. A recent report by Cushman & Wakefield (C&W) showed that in 2016-17, the new launches in the residential category declined by 8%, in comparison to March 2015- April 2016. The January - March quarterly report by  PropEquity also shared a 19.45 % decline  in new home launches. While the industry experts predict that there will no major change in the next two or three quarters, the reason being that the developers are restricting themselves from new launches and re-working on the strategies to comply their e

Home builders switch to equity funding in RERA regime Property advisers and developers feel that the tough deadlines under the RERA have prompted builders to seek long-term equity partnerships, with PE firms to reduce risks, focus on execution and avoid refinancing loans mid-way through the project cycle, rather than settle for structured debt providers seeking short-term profits. They also agreed that equity capital has been coming in the form of platform-level deals, where PE funds and builders partner to invest in multiple projects. However, these transactions are restricted to only larger and branded developers.  For more information  visit to our website

RERA Act extended to entire MP Madhya Pradesh has become the first State in the country to extend the applicability of the Real Estate Act to the entire State. Earlier, projects only in the 153 planning areas were required to be registered with RERA. In an important decision, the RERA has decided to extend the requirement to non-planning areas also, thus bringing the entire State under the purview of the Act. Now onwards, projects coming up anywhere in the State will have to be registered with the RERA and allottees of such projects will get all the protection available under the Act. For more information  visit to our website

Every state to frame their RERA rules in sync with the Act: Centre Ministry officials say that “We have appealed to every state to frame their rules in sync with the Act and they can follow the rules that the ministry has notified for UTs without legislatures. The Act clearly defined terms such as carpet area, flats, ongoing project, and disclosures to be submitted by builders, and specified penalty for offenses by builders. The states should stay away from defining them further to avoid confusion, interpretational difficulties and litigation.” For more information  visit to our website

RERA should also help with a roadmap mechanism for completion of stuck projects. RERA provides for penal action against the developer for non-compliance and compensation to home buyers in case of delay in delivery. However, the mechanism for completion of stuck projects needs to be spelt out. The roadmap for buyers stuck in delayed projects where developers are ready to face the strictest punishment of imprisonment is not clear. Experts say that the government should identify such projects quickly and start an investigation. For more information  visit to our website

On RERA fear, Independent Directors are resigning There is fear among the independent directors of real estate firms, because under RERA independent directors can be held accountable in case a company fails to comply with the new regulations of RERA. The Indian real estate sector has a long history of delayed projects, poor quality and illegal construction. And India has a history that 30% of the projects get delayed. RERA with its new regulations is going to be very tough and developers will have to be equally tough and disciplined. For more information  visit to our website

DLF Homes to pay Rs 22.3 lakh to 13 Panchkula flat buyers as per consumer forum orders The State Consumer Disputes Redressal Forum has said that since the realtor failed to complete construction and deliver possession within the stipulated period and extended one-year period, it is responsible for delays and deficiency in service and their appeal for allowing them escalation cost of construction as well as land holding amounts to seeking an amendment of the terms and conditions of the agreement stands rejected. For more information  visit to our website

Is registration of projects a double-edged sword under RERA? The second chapter of the RERA that focuses on the registration of a project and agents can greatly determine its future or backfire. If the provisions regarding registrations of projects are not implemented properly it can backfire. A lot would depend on the speed with which state governments set up the infrastructure as then only the people chosen to run RERA would have a significant say in its success. For more information  visit to our website

Once GST kicks in, prices of flats may drop by up to 5% Industry experts say that for normal houses (up to Rs 6,000 per sq ft), 12% GST on a finished house or an apartment will be effectively reduced to near zero as the developer will take the credit for taxes he paid on inputs. At the same time, the buyer will not have to pay the service tax 4.5% of the price of the house. This will reduce the cost of acquisition of the house. For more information  visit to our website

Points to watch out in RERA Indian realty is highly characterized by late deliveries and high rate of inventory. Data states that 25 per cent of properties are delayed in India while inventory is more than 14-15 months. This laziness on the part of developers builds up a spiral where high prices chase low demand which further leads to the industrial crunch and opens up the way for illegal, unethical and unscrupulous practices in Real Estate sector. The real estate sector with more than 76,000 companies should have already had a regulatory body and a proper grievance redressal structure. While telecom sector in India with only a few major telecom players in power is under the canopy of the Telecom Regulatory Authority of India (TRAI), no such warden of the real estate sector existed until the government passed the Real Estate (Regulation and Development) Act (RERA) on November 1, 2016. Now that RERA is into force, the expectations of the sector are high. Here is what RERA has in

All You Need to Know about RERA History The Real Estate (Regulation and Development) Bill, 2016 was introduced by Dr. Girija Vyas, Minister of Housing and Urban Poverty Alleviation in 2013. The Union Cabinet of India approved 20 major amendments to the Bill upon Rajya Sabha’s recommendations, in 2015. It then finally got approved by the Rajya Sabha and the Lok Sabha on 10th and 15th March, 2016, respectively and finally became an Act in May, 2016. What is It? RERA aims to create a regulatory body for the real estate sector. The main aim of the Act is to protect the interest or buyers and promote timely delivery of properties or projects. In order to achieve this, registration of the projects covering either more than 500 sq. ft. land or involving at least eight apartments has been made compulsory. The builder or “promoter” will need to furnish the details of the project online and this information would be available to the public. Earlier, builders used to include extra spa

This is how RERA will clean Indian Real Estate The Real Estate (Regulatory and Amendment) Act, 2016 has been approved by the government. Its impact on real estate and parties involved in real estate would be exciting. 20 major amendments have been done to the Act on the recommendations of Rajya Sabha. All of these amendments aim at promoting buyers’ interest and transparency in the real estate market. Several amendments will work differently to achieve one goal. Let’s see how different amendments will clean the real estate sector of India: 1.Quick Deliveries:  the main aim of this act is to eliminate the loophole of late deliveries from the real estate sector of India. Most of the buyers shy away from investing in real estate because their funds remain tied up in properties for years. With regulatory body in place, this Act aims for faster and timely completion of projects and regain investor trust. The redressal system has also been made faster wherein a grievance would