Skip to main content

10 ways the Act affects realtors

By

Separate accounts for each project
Rera makes it mandatory for the promoters to deposit 70 per cent of the unused fund collected for a project in a separate bank account.Such funds can only be used for the purposes of construction and land cost

Required to pay compensation
Developers are required to refund or pay compensation to the allottees with an interest rate of State Bank of India´s highest marginal cost of lending rate plus two per cent, within 45 days of it becoming due.Interest rates are expected to range anywhere around 11-12 per cent

Compulsory registration of projects
The Act provides for mandatory registration of all projects with the Real Estate Regulatory Authority (Rera) in each state.Real estate agents who intend to sell  any plot, apartment or building should also register themselves with this authority.Every project, measuring more than 500 square metres or more than eight apartments, will have to be registered with Rera

Punishment for delay
Under the clauses of the Act, in case of delay in transferring properties to buyers, the Real Estate Appellate Tribunal has the power to intervene and levy fines on developers within 60 days.The maximum jail term for a developer who violates the order of the appellate tribunal is around three years, with or without a fine.
Real estate agents will have to payafine of Rs 10,000 for violating any provisions of the Act, for each day the violation continues or face imprisonment of up to one year

No changing of building plans in the middle of development
The Act prohibits a developer from changing the plan in a project unless two thirds of the allottees have agreed to such a change.

Certification of project
Under the Act, if the developer fails to obtain a completion certificate for ongoing projects in a specified time period, the original sanctioned plans will have to be made public by the developer and any changes that were made atalater date. They will also have to inform and declare the amount of funds collected from the buyers, used so far, along with original completion timeline

Solid credentials needed to start any project
Developers would be required to submit authenticated copy of PAN card, annual report comprising audited profit and loss account, balance sheet, cash flow statement and auditor's report.Not only this, they would have to give a copy of the legal title deed and copy of collaboration agreement if the promoter is not the owner of the plot.They would also have to give information regarding the number of open and closed parking areas in the project

Definition of carpet area
Carpet area has to be clearly defined as it forms the basis for any real estate purchase, eliminating scope for malpractices in transactions

Complete information on the developer
Complete details of developers would be available on the regulator´s website.The information would include company profile, track record, details of any legal cases,financial details of the promoters, status of approvals and projects, among other things

Increased responsibility
Developers would be responsible for fixing structural defects for five years after transferring the property to a buyer

Business Standard New Delhi,01st May 2017

Comments

Post a Comment

Popular posts from this blog

RBI deputy governor cautions fintech platform lenders on privacy concerns during loan recovery

By
  India's digital lending infrastructure has made the loan sanctioning system online. Yet, loan recovery still needs a “feet on the street” approach, Swaminathan J, deputy governor of the Reserve Bank of India, said at a media event on Tuesday, September 2, according to news agency ANI.According to the ANI report, the deputy governor flagged that fintech operators in the digital lending segment are giving out loans to customers with poor credit profiles and later using aggressive recovery tactics.“While loan sanctioning and disbursement have become increasingly digital, effective collection and recovery still require a 'feet on the street' and empathetic approach. Many fintech platforms operate on a business model that involves extending small-value loans to customers often with poor credit profiles,” Swaminathan J said.   Fintech platforms' business models The central bank deputy governor highlighted that many fintech platforms' business models involve providing sm
Post a Comment
Read more

Credit card spending growth declines on RBI gaze, stress build-up

By
  Credit card spends have further slowed down to 16.6 per cent in the current financial year (FY25), following the Reserve Bank of India’s tightening of unsecured lending norms and rising delinquencies, and increased stress in the portfolio.Typically, during the festival season (September–December), credit card spends peak as several credit card-issuing banks offer discounts and cashbacks on e-commerce and other platforms. This is a reversal of trend in the past three financial years stretching to FY21 due to RBI’s restrictions.In the previous financial year (FY24), credit card spends rose by 27.8 per cent, but were low compared to FY23 which surged by 47.5 per cent. In FY22, the spending increased 54.1 per cent, according to data compiled by Macquarie Research.ICICI Bank recorded 4.4 per cent gross credit losses in its FY24 credit card portfolio as against 3.2 per cent year-on-year. SBI Cards’ credit losses in the segment stood at 7.4 per cent in FY24 and 6.2 per cent in FY23, the rep
Post a Comment
Read more

India can't rely on wealthy to drive growth: Ex-RBI Dy Guv Viral Acharya

By
  India can’t rely on wealthy individuals to drive growth and expect the overall economy to improve, Viral Acharya, former deputy governor of the Reserve Bank of India (RBI) said on Monday.Acharya, who is the C V Starr Professor of Economics in the Department of Finance at New York University’s Stern School of Business (NYU-Stern), said after the Covid-19 pandemic, rural consumption and investments have weakened.We can’t be pumping our growth through the rich and expect that the economy as a whole will do better,” he said while speaking at an event organised by Elara Capital here.f there has to be a trickle-down, it should have actually happened by now,” Acharya said, adding that when the rich keep getting wealthier and wealthier, they have a savings problem.   “The bank account keeps getting bigger, hence they look for financial assets to invest in. India is closed, so our money can't go outside India that easily. So, it has to chase the limited financial assets in the country and
Post a Comment
Read more