Jun 16, 2023Investments

RERA: Enhancing Professionalism and Ethics

by Godrej Properties Limited

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The Real Estate Regulatory Authority (RERA) has revolutionised the real estate industry in India by protecting the interests of homebuyers and fostering professionalism and ethics among developers and agents. RERA has established a framework that encourages fair practices, transparency, and accountability. This blog will explore how RERA enhances professionalism and ethics in the real estate sector.

Mandatory Registration of Developers and Agents

Under RERA, developers and real estate agents must register themselves with the regulatory authority. This registration process requires them to fulfil specific criteria and adhere to a code of conduct. By regulating the entry of developers and agents into the market, RERA ensures that only genuine and qualified professionals are involved in real estate transactions, promoting professionalism and ethical practices.

Standardised Sale Agreements and Disclosure Norms

RERA has standardised the sale agreements and disclosure norms, making it mandatory for developers to provide comprehensive information to homebuyers. This includes details regarding the project, its amenities, carpet area, construction progress, and possession timeline. By ensuring transparent disclosure, RERA eliminates the chances of false promises or misleading information, promoting ethical conduct in the industry.

Adherence to Construction Quality and Timelines

Developers registered under RERA are obligated to adhere to strict construction quality standards and completion timelines. Any deviation from the promised specifications or delays in project delivery can result in penalties and legal consequences. This emphasis on timely completion and quality construction ensures homebuyers receive what was promised, enhancing professionalism and instilling trust.

Escrow Account for Financial Accountability

RERA mandates developers to maintain a separate escrow account for each project, where the money collected from homebuyers is deposited. This money can only be utilised for the specific project and is monitored to prevent misappropriation. By ensuring financial accountability and transparency, RERA safeguards the interests of homebuyers and promotes ethical financial practices.

After highlighting some key points, let us take a glance at the 10 principles of RERA.

The 10 Principles of Real Estate Business Ethics by RERA

RERA, or the Real Estate Regulatory Authority, plays a crucial role in enhancing professionalism and ethics within the real estate industry. As part of its regulatory framework, RERA has established a comprehensive code of ethics aimed at promoting integrity, transparency, and fair practices among real estate professionals. Let's explore the 10 principles of real estate business ethics outlined by RERA:

  1. Honesty and Integrity: Real estate professionals are expected to conduct themselves with honesty and integrity in all their dealings, ensuring transparency and trustworthiness.
  2. Fair Treatment: All parties involved in real estate transactions should be treated fairly and impartially, without discrimination or bias.
  3. Confidentiality: Real estate professionals must respect the confidentiality of client information and handle sensitive data with discretion and confidentiality.
  4. Professional Competence: Upholding a high standard of professional competence and expertise, real estate professionals should continuously update their knowledge and skills to provide quality service.
  5. Conflict of Interest: Real estate professionals should avoid conflicts of interest and disclose any potential conflicts to clients, ensuring that decisions are made in the best interest of the client.
  6. Compliance with Laws: Adherence to all applicable laws, regulations, and codes of conduct governing the real estate industry, including RERA guidelines and local regulations.
  7. Protection of Client Funds: Safeguarding client funds and property, ensuring that financial transactions are conducted with diligence and accountability.
  8. Transparency: Real estate professionals should provide clients with accurate and transparent information about properties, pricing, and other relevant details to enable informed decision-making.
  9. Consumer Education: Educating clients about their rights, obligations, and options, empowering them to make informed decisions and protect their interests.
  10. Ethical Advertising: Real estate professionals should engage in ethical advertising practices, ensuring that advertisements are truthful, accurate, and not misleading to consumers.

The Final Word: Ushering to a New Era of Professionalism and Ethics

RERA has played a vital role in enhancing professionalism and ethics in the Indian real estate industry. RERA has set new benchmarks for real estate practices through mandatory registration, standardised agreements, disclosure norms, and strict adherence to quality and timelines. As a result, homebuyers now have increased confidence and trust in the market, knowing that their interests are protected and ethical conduct is prioritised. RERA's focus on transparency and accountability has created a positive environment that benefits buyers and developers, ushering in a new era of professionalism in the real estate sector.

 

Frequently Asked Questions

1. Who needs to register under RERA?

Ans. Developers and real estate agents must register under RERA to operate in the market.

2. How does RERA promote professionalism?

Ans. RERA promotes professionalism by mandating registration, standardised agreements, adherence to quality and timelines, and financial accountability. These measures ensure that only qualified professionals enter the market and that ethical practices are followed throughout real estate transactions.

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