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RERA to be implemented from May 1: Here are the benefits buyers must know | 1 BHK in hinjewadi

RERAIndia's real estate sector has been marred by inordinate project delays and poor quality of construction. Last year, the government had announced the much-awaited regulator for the realty sector.

Here are six ways in which homebuyers stand to benefit from RERA, which will come into force from May 1:
1) Escrow account:

The developer will have to transfer 70 per cent money received from home buyers to an escrow account. "This money will be withdrawn as per the stages of construction, approved by engineers and chartered accountants of builders. This will prevent developers from using the money raised for one project for any other project

2) Pay for what you get:

The buyer will pay only for the carpet area (area within walls). The builder can't charge for the super built-up area, as is the practice at present, where you get 900-1,000 sq. ft. carpet area if you book a 1,300 sq. ft. house (the rest is balconies and common spaces).

3) Clearances before selling:

Developers will be able to sell projects only after the necessary clearances. Under RERA, builders and agents will have to register themselves with the regulator and get all projects with more than eight apartments registered before launch. This will take care of common malpractices such as selling property before getting the necessary clearances. The builder will also have to disclose every detail about the project - number of apartments, carpet area, etc.

4) Five-year warranty:

The builder will have to provide for any structural defect in the building for five years. However, the law doesn't define structural defect clearly, which may lead to disputes between builders and home buyers

5) Will property prices increase after the implementation of RERA? Property prices are not connected to RERA. It is determined by demand and supply in the market. Given the scenario right now, I do not think prices will see a correction after the implementation of RERA. However, margins are expected to increase because of lower cost of construction and developers will be in a position to pass the benefits to customers.

6) Role of states:

Although RERA is a central law, its implementation will depend on state governments, as real estate is a state subject

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