MahaRERA's New Guidelines: Enhanced Protection for Homebuyers in Maharashtra
From July 1, developers in Maharashtra will be required to maintain designated bank accounts to ensure transparency and accountability in financial operations of housing projects.
MahareraHomebuyersReal EstateMaharashtraReraReal Estate MaharashtraJun 28, 2024
The aim of this initiative is to build trust among homebuyers by legally securing their investments. MahaRERA Chairman Ajoy Mehta stated that these measures are intended to enhance financial oversight and reduce delays in project completion, thereby benefiting homebuyers and improving the real estate sector's credibility.
Previously, developers often asked homebuyers to make payments to different bank accounts for different purposes, such as flat booking fees or amenities like gymnasiums and swimming pools. The new move will ensure developers can't claim lack of funds as an excuse for not refunding booking amounts to flat purchasers who wish to exit a project.
To discontinue this practice and enforce financial discipline, MahaRERA has ordered developers to open three accounts within one bank RERA Designated Collection Account, RERA Designated Separate Account, and RERA Designated Transaction Account. These accounts will be used for specific purposes, including collecting revenue from flat buyers, allocating funds for land and construction, and facilitating project-related expenses.
Homebuyers' payments, excluding government taxes and charges, will be fully deposited into the RERA Designated Collection Account. A minimum of 70% of this revenue will then be transferred to the RERA Designated Separate Account for land and construction expenses, while the remaining 30% will go to the RERA Designated Transaction Account. This process will be facilitated by banks through auto sweep, and funds from these accounts cannot be withdrawn via traditional means such as cheques or online banking.
If a homebuyer cancels his/her registration, he/she will be entitled to a refund of 70% of the amount received from the RERA Designated Separate Account, along with compensation for any losses. The remaining 30% will be refunded from the developer's RERA Designated Transaction Account.
Information
Maharashtra Real Estate Regulatory Authority (MahaRERA) is a regulatory body established under the Real Estate (Regulation and Development) Act, 2016 to regulate the real estate sector in Maharashtra. The authority aims to promote transparency, accountability, and fair play in the sector.
Maharashtra Real Estate Regulatory Authority (MahaRERA) is a statutory body responsible for regulating the real estate sector in Maharashtra. The authority aims to protect the interests of homebuyers and promote a transparent and accountable real estate sector.
Frequently Asked Questions
What is the main objective of MahaRERA's new guidelines?
The main objective is to enhance transparency and accountability in the financial operations of housing projects and protect homebuyers' investments.
How many bank accounts will developers be required to open?
Developers will be required to open three bank accounts within one bank: RERA Designated Collection Account, RERA Designated Separate Account, and RERA Designated Transaction Account.
How will the new guidelines benefit homebuyers?
The new guidelines will ensure that developers cannot claim lack of funds as an excuse for not refunding booking amounts, and homebuyers will be entitled to a refund of 70% of the amount received from the RERA Designated Separate Account if they cancel their registration.
What is the purpose of the RERA Designated Separate Account?
The RERA Designated Separate Account is for allocating funds for land and construction expenses, and a minimum of 70% of the revenue collected from homebuyers will be transferred to this account.
Can developers withdraw funds from the RERA Designated Collection Account and RERA Designated Separate Account using traditional means?
No, funds from these accounts cannot be withdrawn via traditional means such as cheques or online banking. The process will be facilitated by banks through auto sweep.
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