Monday, September 28, 2009

Article In THE TIMES OF INDIA

There was This article that i was reading in the news paper thought it would be nice if all of us could share it.Hope our system will quickly change and we could initiatelegal action against ERa.Please read,The aam aadmi looking to own a piece of real estate might be able to breatheeasier. The possibility of being hoodwinked by asmooth-talking builder or salesman might be reduced sharply as developers willsoon be required to post project details, including civic clearances, on thewebsite of the real estate regulator.This should also reduce the chances of honest property buyers being duped bydevelopers hiding behind terms like "super area" and fine print about various"charges" to conceal actual floor area and the final costs.The model Real Estate (Regulation of Development) Bill has been long awaited andstates are expected to legislate in keeping with the detailed provisions of theproposed law. They will also set up regulators to give effect to the bill whicheven recommends a three-year jail term or penalty which may amount to apercentage of project cost for failure to register.The law to regulate real estate developers will call on builders to providedetails of the number and size of plots, layout plan, carpet area and plintharea of flats, apartments or any other housing complexes.Importantly, it will prevent builders from changing the plans or insertingcharges as the sale agreement will be considered binding. They will also postauthorised brokers and dealers.The legislation will prevent advance payments being extracted from buyerswithout a written sale agreement containing project timeline, payment detailsand possession date. The promoter will not be able to cancel the sale deedunilaterally. If there is sufficient reason to do so, a notice will have to begiven and the money paid will be returned with interest fixed to bank rate. Thepromoters would furnish a bank guarantee equal to 5% of estimated cost ofprojects.The proposed bill mooted by housing ministry, a draft of which has beencirculated to all stakeholders, has asked promoters to submit the details ofapproval and sanctions from civic agencies and bank guarantee furnished.The draft bill has maintained the power of civic agencies to approve theproject. It will be the responsibility of the developer to give information tobuyers relating to nature of the title to land, layout plan sanctioned by localauthority and plan of development works. The big advantage of the law would bethat civic agency details will be given to the regulator.The developers also cannot hide the "actual living space" they are offering tobuyers as they have to distinguish the carpet area, super area and common areaalong with the plan and specifications ofapartments.The consumer can ask promoters to spell out the details of common services likesupply of electricity, water, sewage and drainage, lift, light in passages andstaircases, sanitary services and fire-fighting instruments in the project. Andif developers fail to provide these services, consumers can approach theregulator, which can also take suo-moto cognizance and inquire into the matterand pass order as it may find necessary.If there is any deviation from the advertisement, the promoter has to compensatebuyers for any loss due to false information. In case of pulling out of aproject, the builder has to return the money with interest at a rate not morethan current rate.The buyer can also directly apply to local body for occupation certificate ifthe developer is delaying even after completion of the project and the costincurred by the allottee will be recovered from the promoter. After a saleagreement is concluded, the builder will not be able to mortgage or create acharge on plot or apartment without written consent of the buyer.

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