NEW DELHI (TIP): The Rajya Sabha passed the much-awaited Real Estate Bill on Thursday, prompting PM Narendra Modi to hail it as “great news for home buyers”. The bill, which seeks to regulate the property sector, bring in transparency and help protect consumer interests, is now slated to be taken up by the Lok Sabha on Monday. Here are 10 key features of the bill:
- All projects will have to be registered with regulatory authorities, and developers will have to disclose project information including details of the promoter, project, layout plan, land status, status of approvals and agreements along with details of real estate agents, contractors, architects and structural engineers.
- There will be no discrmination of any kind on basis of religion, region, caste, creed or sex and gender and we will include that in the rules. The government may bring in a “non-discriminatory” clause to allow anyone (including a transgender) to buy property in a complex. When some House members raised the issue of discrimination in selling flats and plots to certain communities, Urban development minister M Venkaiah Naidu said the constitution provides equality for all
- Builders will have to deposit a minimum of 70% collections from buyers in an escrow account to cover cost of construction and land. State-level Real Estate Regulatory Authorities will be established to regulate transactions related to both residential and commercial projects and ensure their timely completion and handover.
- No pre-launch will be allowed without getting all approvals from the local authorities and without obtaining registration from the regulator. All incomplete projects are to come under the regulation.
- The bill covers any project that is more than 500 sq m or has more than eight apartments (states can lower this requirement further).
- Builders can no longer go scot-free by putting up flashy designs or photographs of a project to attract buyers and failing to deliver projects that match the pictorial claims.
- The bill states the builder has to return the payment with interest to buyers who are affected by such “incorrect, fast statements contained in the notice, advertisement or prospectus or the model apartment, plot or building as the case may be”.
- It provides for imprisonment of up to three years for promoters and up to one year for real estate agents and buyers and/or monetary penalties if they violate orders of appellate tribunals.
- The authority can even order “compensation” to consumers in case of misleading advertisements.
- In addition, developers will have to provide brief details of projects launched in the past five years, both completed or under-construction, and the current status of the projects. These may be made available on the regulator’s website so buyers can take an informed decision.