Will the New Grading Scale by UP RERA Benefit?
WIth UP RERA now introducing a grading scale for real estate, then this step may bring another remarkable change in the dealings of property cases for homebuyers. Keeping the buyer interest above, this new addition can influence the real estate market in a prominent way. Let's find out how.
By Apeksha Pandita in Property Law
Nov. 24, 2018, 12:54 p.m.
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With the introduction of RERA in 2016, the property troubles have disappeared for almost everyone. RERA has not only proven to be beneficial in many ways than one, in fact, but RERA has also changed the entire scenario for the homebuyers and the real-estate agents & developers.
With RERA now, you can track the developments made in your property, no property developer can charge you more, you are availed with timely possession of the property and if not, then you are offered with a satisfying refund with interest on it.
Since RERA is still very new, therefore, its law is subject to many more amendments and modifications. These constant updates and changes are taking place only to make the processes way easier and effective for home-buyers at large, and also benefit the real estate developers.
The need for constant optimization is inevitable.
Since the complaints coming in from every buyer will be different and the solution to this will depend on the nature of the complaint and the situation of the buyer and the real estate agent.
Above & beyond, RERA is trying to achieve organization and systematic working in the real estate sector. RERA Act aims to provide the homebuyer with the following benefits:
Benefit for stakeholders
Protection from Insolvency
Assurance of quality products & services
Be informed of any changes, constant updates
Interest on the Amount, if the delivery is delayed unreasonably
UP RERA (pdf) started its function in September 2018 and on the first day, it took up 31 complaints and it buckled up to pass orders on each case within the timeline of 180 days.
With the ongoing process of attending all property complaints, the UP RERA has launched to conduct a grading exercise of developers as well as housing projects in the state, which homebuyers and financial institutions can use as a guide.
According to the new grading scale, each developer and project will get an individual rating on a scale of 0 to 5, with five being the best.
As per the news reported by TOI, UP-Rera chairperson Rajive Kumar told TOI, “We will start the process from January and the plan is to come out with first grading by September (2019). The grading will be primarily based on the feedback of people who have been associated with the project and how compliant they (the projects and builders) are with the Rera rules.”
This grading scale will thus help in creating a track record for builders and better addressing the issues of delays in possession and major slowdown in the areas of Noida, Greater Noida and Ghaziabad.
However, according to TOI, “this is being seen as an innovative mode of ‘naming and shaming’ the real estate players guilty of not delivering projects to buyers on time.”
About 80,000 complaints have been received from the entire state of UP, where 80% are revolving around Noida, Greater Noida and Ghaziabad. According to Rajive Kumar, “Out of the 98 projects which were covered, there is absolutely no problem in 25 projects. There are serious issues in another 20-25 projects, which are difficult to resolve.”
Well, how effective will this be, is a story that has to wait till January 2019.
The grading scale may bring the customer reviews and feedback into the limelight. This would not only provide a rating and ranking for all developers, but it can also be used as a method to scrutinize and help in judging the who to pick for your property requirements.
The parameters being used in this grading may depend on the value provided to each customer, how the developer interacts with the buyer, whether the rate of the property is worth, more so, the entire process of the homebuying will be under the critical observation of the customer.
The issues under this scale that one can come across may be that the effectiveness of the developers’ approach and working may get restricted to a time boundary, limiting his/her rating and review till the next financial year.
If this strategy works out, there is a probable chance that other state RERA will also adapt this depending on the end result in September 2019. This can be however taken as a lesson for other states RERA, who are still lagging behind in the proper implementation of this Act.
As per the RERA Act - “It prohibits unaccounted money from being pumped into the sector and as of now 70 per cent of the money has to be deposited in bank accounts through cheques is now compulsory. A major benefit for consumers included in the Act is that builders will have to quote prices based on carpet area, not super built-up area, while carpet area has been clearly defined in the Act to include usable spaces like kitchen and toilets.”
At the end of the day, any new input in the state RERA will only focus on the protection of the buyers such that none is cheated or scammed.
Here’s keeping fingers crossed for a new phase of RERA benefiting the property scene of India.
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