The policies under RERA (Real Estate Regulatory and Authority) are made very intelligently from the policy makers of this country. Its new clause that every real estate project must have its own account and that account should have at least 50% funds from the buyers, has a potential to end the miseries faced by many home seekers. The promoter has to make a separate account on the project’s name with all the finances of that project done on that account. The 50% mandating on the accounts is very important considering that many problems in India’s real estate have to do regarding the usage of money.
The problems that buyers have that is, they get delayed possession of their homes as a builder often says that he has no funds to complete the project. One might be quite surprised to hear a builder say such thing when he gets the payment of the house within a couple of months of the booking. Sadly, this has become a norm. The actual picture says that these promoters take this money to start a new project somewhere else, and hence, start a vicious circle of eating the money of innocent home seekers. The Real Estate Regulatory Act of 2016 will ensure that a project must keep 50% of its acquired money from buyers in the account. All the transactions will only be done after the chief engineer, architect and chartered accountant certifies the use of money in that particular project or for the withdrawal by a promoter. Thus, buyers are quite assured as chances of delayed possession get diminished and other frauds related to real estate will also get lessened.
However, this will also be advantageous to those builders who seek to work with the norms set by the government. Keeping 50% of acquired funds will be helpful for them as they will have a fixed capital in case they lose money in their other business ventures. It will work in their favour too as they will now get the confidence to expand their business within the confines of laws and not worry about getting scrutinized by the people.