Investment School . Know your RERA agent

Real estate agents help in transforming houses to homes. But more often, potential home buyers shy away from making a purchase through an agent.

This is largely because agents have no specific qualification or experience and also as there is no code of practice which sets a transparency and professional benchmark.

However, with the implementation of the Real Estate (Regulation and Development) Act (RERA), not only developers but also agents and property consultants are to be accountable.

As per RERA, real estate agents are mandated to register with the respective State regulatory body (RERA) and obtain a broker’s licence to continue their business operations. The Act also binds an agent into dealing only with RERA-registered properties. When agents are registered under RERA, they may bring professionalism in the business such as maintaining deadlines and proper communication.

Such agents should also maintain books of accounts and documents related to business operations and client dealings.

If you plan to buy a property through an agent and he/she is registered under RERA, you can verify the agent’s registration/licence validity. The agent must display his/her registration number at their place of work as well on all the documents and advertisements.

You can verify these details on the respective State RERA website; you can also find an agent through the website.

For instance, on Maharashtra RERA’s website, you check details such as the agent’s address, past experiences, projects handled, contact number, website details (if available), area of operations, branch details, registration number and the validity of the same.

Therefore, as a potential home buyer, you can be assured of the authenticity of these registered brokers.

Note that since the definition of real estate agents includes all those involved with sale/purchase of registered projects, web portals engaged in selling properties are also covered under the Act.

They are required to comply with the duties and responsibilities as mandated under RERA.

Things to note

With RERA in place, buyers of properties now have recourse in case of any unethical behaviour from agents or developers.

As of April 2019, 30,834 agents are registered with RERA. Though the progress is slow, the number is increasing with rising awareness among agents and buyers. Real estate agents will also be liable for any flaws in the project (that has not been informed to the buyer), and can be prosecuted for any misconduct in the business.

If a broker fails to get himself/herself registered as mandated by RERA, he/she shall be liable to pay penalty (to the authority) of ₹10,000 per day during the period in which default continues, which may cumulatively extend up to 5 per cent of the cost of the plot/apartment/building for which the sale/purchase was facilitated, as determined by the authority.

If the agent continuously fails to comply with the orders of the appellate authority, he/she shall be punishable with imprisonment of up to a year or will be fined for every day during which the default continues, which may cumulatively extend up to 10 per cent of the estimated cost of the property as determined by the authority, or both.

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