The Real Estate Regulatory Act (RERA) got implemented in India in 2016 and since then the real estate sector has come a long way. The Act covers nearly all the stakeholders and property brokers are no exception. There are certain rules and regulations which every property broker operating in India must know about. Here is a quick list of those regulations.
1. What is the first step for a property broker to be in line with RERA? The Act covers all the companies and individuals that are involved in buying and selling of immovable assets. It mandates all the property brokers to compulsorily register himself with the Real Estate Regulatory Authority. No broker is supposed to operate in the market unless he registers himself with the authority and holds a valid registration number. As RERA has been implemented by the states, there are separate websites of RERA from every state and a property broker can check the details about the registration including the application procedure, period of registration, fee, etc.
2. What are the consequences if a property broker does not register under the Act? There are serious penal provisions in case a property broker does not register himself with the Authority and continues to operate in the market. The regulator may impose penalty as high as Rs 10,000 for each day of default above the deadline stipulated by the regulatory authority. The regulator may even impose a penalty of up to 5% of the total value of a deal executed by the broker.
3. What types of real estate projects does it cover? The Act covers all types of properties - be it residential, commercial, industrial, retail or hospitality. Therefore, the property brokers have to register with the authority irrespective of their domain specialization. The Act does not differentiate between ongoing or yet-to-be-launched projects. That is why, all the current projects, which are under-construction, fall under the ambit of RERA. Needless to mention that the new real estate projects have to mandatorily register under the Act.
4. Are there any projects that are exempted from RERA? Yes, there are certain types of real estate projects that are not being covered by the Act. These include: " Projects that are below 500 square meters in size " Projects where the number of apartments being constructed is below 8 " Projects that have already received the Completion Certificate before the enforcement of the Act " Projects that are under renovation mode and do not offering any properties for sale The Act, otherwise, covers all the projects that are being marketed in public.
5. What about properties in the resale market? Broadly speaking, the Act covers all the property transactions that are executed through either sale or transfer agreement.
6. What is the difference between occupation certificate and completion certificate? A real estate project gets the completion certificate from the local Municipal Corporation once the authority verifies that the project has been developed in accordance with the sanctioned plan and meets all the specifications laid by the government The occupation certificate, on the other hand, is awarded when the real estate developer provides all the necessary civic infrastructure. In short, the project should be inhabitable with all the essential facilities such as water, electricity and sanitation in place.