RERA's Warranty Clause Will Strengthen Homebuyer-Developer Ties
The enthusiasm to shift into a new house is sometimes cooled by the discovery of certain construction defects in your new home. Until the Real Estate (Regulation and Development) Act, 2016, came into the picture, there was no way forward for such home buyers to convince developers to fix the defects. Most of them would get the job done on their own, even as they felt betrayed by the developer. In a nutshell, all this points out to the trust deficit between the home buyer and the developer.
But now, the new legislation aims to bridge this gap.
According to Clause 14 (3) of the Real Estate Act, a developer will be liable to fix any defects that may be brought to his notice by a home buyer until five years after the possession is granted, without charging any amount for it. Further, the developer will have to fix the problem within 30 days. In case the developer fails to comply, a home buyer will be eligible to get a compensation under the Act. Earlier, in their sale agreements, many developers used to keep the period for fixing defects to as low as two years.
Obviously, homebuyers are celebrating this provision. So far as developers are concerned, it might seem that they would strike a note of dissent over the clause, but most of them are all praise for it. The clause, they say, is expected to weed out non-serious players from the market. The misdeeds of a few earlier brought bad name to the entire fraternity, they say.
This will also encourage developers to maintain quality of their constructions at the initial stage. They are, after all, not left with much choice. A five-year period is a long time and frequent complaints by buyers would cost developers not only money but also their brand image.
The clause may go a long way in improving the health of the sector and pushing real estate towards a growth path by creating an amicable environment, where home buyers would not have to worry about the walls of their recently bought houses falling apart.
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