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Are RERA-Approved Projects Safe?

When investing in real estate, safety and reliability are paramount concerns for buyers. One way to ensure that your investment is secure is to opt for projects that are approved by the Real Estate (Regulation and Development) Act, 2016 (RERA). Here’s why RERA-approved projects are considered safe and why you should consider them for your next property investment.

What is RERA?

The Real Estate (Regulation and Development) Act, 2016 (RERA) was enacted to address various issues plaguing the real estate sector, including delays, unfair practices, and lack of transparency. The act aims to protect home buyers and ensure that real estate transactions are fair and efficient.

Key Benefits of RERA-Approved Projects

1. Transparency

RERA mandates that all real estate developers must register their projects with the regulatory authority before advertising or selling. This registration process requires developers to provide comprehensive details about the project.

2. Timely Project Completion

One of the biggest challenges in the real estate sector has been project delays. RERA addresses this issue by imposing strict regulations on project timelines. Developers are required to adhere to the completion dates they promise. If they fail to do so, they are liable to pay interest on the amount paid by buyers for the delay period, ensuring accountability.

3. Quality Assurance

RERA includes provisions that hold developers accountable for the quality of construction. If any structural defects or issues arise within five years of possession, the developer is obliged to rectify them at no extra cost to the buyer. This guarantees that buyers receive a property built to high standards.

4. Financial Discipline

To prevent misuse of funds, RERA requires developers to deposit 70% of the project funds collected from buyers into a separate escrow account. These funds can only be used for the construction and land-related costs of that particular project. This ensures that the funds are not diverted to other projects, safeguarding the interests of buyers.

5. Fair Practices

RERA prohibits developers from making changes to the project plan without the consent of two-thirds of the buyers. This protects buyers from arbitrary alterations that could affect the value or usability of their property. Additionally, the act mandates the use of standardized sales agreements, which include details on project completion timelines, penalties, and other critical aspects, ensuring fair practices in the industry.

Buyer Protection and Redressal

RERA has established a robust redressal mechanism for buyers. If there are any grievances regarding project delays, quality issues, or other matters, buyers can file complaints with the RERA authority. The act mandates a resolution of complaints within 60 days, providing a quick and efficient means of addressing buyer concerns.

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