As per news ,the Union urban development ministry on Monday notified the rules under the Real Estate Regulation Act, which was enacted earlier this year. Also, the Centre notified on Wednesday a standard house purchase agreement that builders or developers all over India must sign with homebuyers, This can be very positive for homebuyers.
The new Act, also notified by various state governments, will empower homebuyers to terminate their sale agreement with developers and seek refund with interest at around 11%, in case developers delay possession. The refund and interest is payable within 45 days from the date of notice of the termination.
The rules include a 20-page format of an “Agreement for Sale“, which clearly lays out a number of obligations that developers must discharge towards their customers. The sale agreement, which underlines the principle that timely execution of a project is the essence of the agreement, provides that apart from the refund option in case a buyer does not want to withdraw from a delayed project can take the apartment and be paid interest for the delayed period too.
This act will apply to projects under construction too.
As per news, The act secures timely possession of property and refund or payment of compensation with interest in case of delays, the rights of buyers in the agreement include rectification of structural defects by promoter, over a period of five years from the date of issuance of occupancy certificate.
The rules, which were notified by the Union government on October 31 for Union Territories without legislatures, have been notified by the governments of Uttar Pradesh and Gujarat, while Haryana is expected to do so by December. As per the provisions of the real estate regulatory act, each state must put in place a Real Estate Regulatory Authority (RERA) by April 30, 2017, before the full act comes into effect the next day. Thus, poll-bound states like Uttarakhand, Punjab, and Goa are likely to follow suit by December, 2016. The new rules, however, exempt developers from any interest liability for any delay caused by a force majeure conditionlike war, floods, cyclone, drought, among others, which are beyond the control of the developer.
At the same time, if a buyer defaults on payment to the developer and this persists for a specified number of instalments over the specified number of monthsdetermined in the agreementthe developer can terminate the agreement and cancel the allotment to the buyer. The developer can then deduct the booking amount and the interest liabilities from the amount to be repaid to the buyer.
The sale agreement also stipulates that the total price of apartment or plot will be free from escalation except when development charges are increased by the local authorities concerned. Apart from the right to receive timely payment from buyers, the agreement also provides for certain rights to promoters or developers like interest in case of delay in payments by buyers and additional payments for increase in carpet areaup to 3% of the area originally offered.
The “Agreement for Sale“ makes it mandatory for a developer to disclose the number of flats and the floor allotted to a buyer, along with the carpet area, the number and the area of the garage or covered parking, date of grant of commencement certificate by the local authority, name of the authority that granted the required approvals, etc.
It also asks the developer to disclose the break-up of cost including the cost of the apartment, exclusive balcony or verandah, exclusive open terrace, proportionate cost of common area, preferential location charges and taxes, and maintenance charges, among others.