The Real Estate Regulator Bill (RERA) came into force on May 1st, 2016 with the mandate that all state governments will formalize Act’s rules and regulations for their respective states by 31 October, 2016. But most states have missed the deadline while many like Haryana have not even started with the drafting process. Below is the lowdown on all that has happened on RERA so far.
Gujarat- Gujarat became the first and only state to notify the state rules of the RERA Act before the deadline of 30th October. The rules are expected to come into force on May 1st 2017. We learnt that the state’s RERA may not have a retrospective effect and will only cover real estate projects launched after November 1st, 2016. This is also in stark contrast to rules being made by other states including Maharashtra and Karnataka, where the state RERA is expected to have a retrospective effect.
Uttar Pradesh- The Uttar Pradesh Real Estate (Regulation and Development) Rules, 2016 were finalized and notified on October 27 and is likely to bring relief to lakhs of home buyers in the Ghaziabad, Noida and Greater Noida region. Uttar Pradesh became the second state after Gujarat to notify the Real Estate Regulation and Development Rules, 2016.
Under the UP RERA rules, “ongoing project” refers to projects where development is ongoing, but where completion certificate has not been obtained.
Delhi- The Ministry of Urban Development approved the Real Estate General Rules and Rules for Agreement for Sale for the National Capital Territory of Delhi as required under the Real Estate Regulation & Development Act,2016 (RERA) on 23rd November. These rules which were formulated after consultations with the Delhi Government, the three Municipal Corporations of Delhi, the Delhi Development Authority and other stakeholders are waiting to be notified.
The Vice-Chairman of the Delhi Development Authority (DDA) Udai Pratap Singh has been appointed the interim regulatory authority for Delhi. The interim regulator will be responsible for undertaking preparatory actions like setting up the website and putting in place required institutional mechanisms so that the RERA can start functioning as and when it is established.
UTs- The ministry of Housing & Urban Poverty Alleviation notified the Real Estate (Regulation and Development) (General) Rules, 2016 for the five Union Territories of Andaman & Nicobar Islands, Dadra & Nagar Haveli, Daman & Diu, Lakshadweep and Chandigarh, without legislature.
Under the rules which were notified on 31st October, 2016 – the sales agreement will mandatorily have to specify the date of delivery of possession to buyer and a schedule of payment as agreed upon by both parties. Violation of either of these commitments can be treated as default.
Karnataka- The state had the government put out the draft rules on 27th October for public suggestions. The buyer group, Fight For RERA, however, did find loopholes in the centre’s draft rules and stated they were engaging with the government to rectify those in the state's rules. The government is yet to notify the draft rules. "We have tried to keep the rules similar to the Centre's model" said Shambhu Dayal Meena, principal secretary at the department of Housing.
Maharashtra- From leading the race to formulate the draft rules to missing out on both October 31st and November end deadlines for notifying the rules, Maharashtra has surprised the buyer groups in the state. Prakash Mehta, Housing Minister, Maharashtra, has come on records to clarify the situation- ‘There were 4 amendments in the act which came from Delhi, we had to rectify the act and again send it to the department and that's why there was a delay’.
So far only Gujarat and Uttar Pradesh have notified the rules. Despite best efforts from buyer associations like Fight For RERA, states have managed to dilute certain provisions in the law to benefit the developers. It seems it will take longer than expected before all states adopt RERA in letter and spirit.