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Why RERA registration of agents is key for home buyers
The Hindu Business Line  |  November 27, 2019

Bavadharini KS BL Research Bureau

You may have thought twice about purchasing a residential property through agents or brokers, because of their perceived unprofessionalism.

 

This is not going to be the case anymore. With the implementation of the Real Estate (Regulation and Development) Act (RERA), registration has been made mandatory for real estate agents/brokers. The aim is to protect the interest of the buyers and sellers from unscrupulous brokers/agents.

 

Here is how RERA registration helps.

 

Registration benefits

 

When home buyers start looking for property, real estate agents are often the first point of contact.

 

In India, 40-65 per cent of residential property sales are transacted through agents or brokers.

 

‘Agents/brokers’ refers to those who arrange property transactions between buyers and sellers by acting as their representatives to negotiate deals.

 

However, in India, real estate broking doesn’t require specific qualifications or experience. However, now that RERA registration is made compulsory, one can expect to see professional conduct from both individual brokers and agencies.

 

Ritesh Mehta, Senior Director & Head, West India, Residential Services, Developer Initiatives India, JLL, says: “Mandatory registration is set to address existing issues that buyers and sellers have with agents in terms of accountability, transparency, proper communications and other information related to a property.”

 

The new Act has made it compulsory for an agent who wants to continue with his/her business operations to register with the respective State RERA and obtain the licence to practice.

 

It also mandates that an agent should deal only with RERA-registered properties. Such agents should also maintain books of accounts and documents related to business operations and client dealings.

 

As on November 15, 2019, there were 36,823 agents registered with RERA across the country. The number is increasing with a rise in awareness among agents, developers and buyers.

 

If an agent fails to register under RERA, he/she is liable to pay a penalty (to the authority) of Rs. 10,000 for each day of default. This penalty may cumulatively extend up to 5 per cent of the cost of the property or plot, apartment or buildings for which sale/purchase has been facilitated.

 

In case of continuous failure to comply with the orders, agents/brokers will be punished with imprisonment up to one year or will be fined for each day of default, which may cumulatively extend to up to 10 per cent of the estimated cost of the property as determined by the authority, or both.

 

Advantage buyers/sellers

 

While RERA doesn’t specify any qualification requirements for agents, related courses could be designed by the State education boards as mandated by the authority for people entering the field. With RERA in place, home buyers can now have easy legal recourse in case of any unethical practices by agents or brokers. You can verify the agent’s registration or validity of licence. This should usually be displayed at the brokers/agents’ workplace as well as in the documents and advertisements.

 

Fact-checking

 

You can also check in the respective State RERA’s website for details about agents.

 

For instance, if you check Maharashtra RERA’s website for, say, Estatemint, a real estate consultant in Pune, you will get details such as address, past experiences along with projects handled, contact number, website details, if available, area of operations, branch details, registration number and the validity of the same.

 

This gives an assurance of the authenticity of such agents.