MahaRERA Cracks Down on Real Estate Developers: A New Era of Transparency and Accountability
MahaRERA has directed real estate developers to maintain three separate bank accounts for every project in a single bank, effective from July 1, to ensure financial discipline and timely completion of projects.
MahareraReal EstateTransparencyAccountabilityHomebuyersReal Estate MumbaiJun 27, 2024
The Maharashtra Real Estate Regulatory Authority (MahaRERA) has taken a significant step towards ensuring transparency and accountability in the real estate sector. With the aim of protecting homebuyers' interests and promoting financial discipline among developers, MahaRERA has made it mandatory for developers to maintain three separate bank accounts for every project in a single bank.
Key Decisions
Effective from July 1, developers will not be able to deposit amounts received from homebuyers in different bank accounts. Instead, they will be required to maintain three separate bank accounts for every project in a single bank. The first account will be for amounts received from homebuyers, the second for keeping aside 70% of the funds allocated (escrow) for the project, and the third for maintaining the balance 30% of the funds received.
The Maharashtra Real Estate Regulatory Authority (MahaRERA) is a regulatory body established to ensure transparency, accountability, and fair play in the real estate sector. With its commitment to protecting homebuyers' interests, MahaRERA has been taking proactive measures to promote a healthy and sustainable real estate ecosystem.
Impact on Homebuyers
This decision is expected to significantly benefit homebuyers, who will now have greater confidence in the real estate sector. With the legal protection of the RERA designated collection account and RERA Designated Separate Account, homebuyers can be assured that their investments are secured and protected.
Current Practice
Currently, MahaRERA mandates developers to maintain one single designated account for every project, with 70% of the total project cost in the designated account (escrow account). However, developers have been asking homebuyers to deposit money in separate bank accounts for different purposes, which will no longer be allowed.
Reaction from Developers
Real estate developers have welcomed MahaRERA's move, seeing it as a win-win for both homebuyers and developers. With the aim of safeguarding the project completion process, developers believe that this decision will promote transparency, accountability, and timely completion of projects.
FAQs
Q What is the new requirement for real estate developers in Maharashtra?
A Developers must maintain three separate bank accounts for every project in a single bank.
Q What is the purpose of the three bank accounts?
A The first account is for amounts received from homebuyers, the second for keeping aside 70% of the funds allocated (escrow) for the project, and the third for maintaining the balance 30% of the funds received.
Q When does the new requirement come into effect?
A The new requirement is effective from July 1.
Q How will this decision benefit homebuyers?
A Homebuyers will have greater confidence in the real estate sector, and their investments will be secured and protected.
Q What is the reaction from real estate developers?
A Developers have welcomed MahaRERA's move, seeing it as a win-win for both homebuyers and developers.
Frequently Asked Questions
What is the new requirement for real estate developers in Maharashtra?
Developers must maintain three separate bank accounts for every project in a single bank.
What is the purpose of the three bank accounts?
The first account is for amounts received from homebuyers, the second for keeping aside 70% of the funds allocated (escrow) for the project, and the third for maintaining the balance 30% of the funds received.
When does the new requirement come into effect?
The new requirement is effective from July 1.
How will this decision benefit homebuyers?
Homebuyers will have greater confidence in the real estate sector, and their investments will be secured and protected.
What is the reaction from real estate developers?
Developers have welcomed MahaRERA's move, seeing it as a win-win for both homebuyers and developers.
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