Real estate brokers or agents are an integral part of the realty ecosystem. There are about 9,00,000 brokers moving a capital of around 4 billion USD through the way of transactions. This humongous section of people was not under any kind of surveillance or regulation till now. No clear roadmap, until now. However, with increasing dependence of the home buyers or renters on them, their practices had to be checked and controlled for the ultimate price benefit of the end customer. RERA (Real Estate Regulatory Act) of 2016 is seen as a way to bring in professionalism in the working style of real estate brokers. This RERA act has demanded all the agents and broking firms to get them registered under RERA with immediate effect. Here is an overview of RERA impact on real estate agents and their work ethics.
More professionalism in real estate broking
All brokers and real estate agents are supposed to be registered with RERA. This has a very profound meaning. The immediate RERA impact on agents will be seen in their turning into more professional entities. They would be expected to market only RERA-compliant projects. It would be imperative for them to keep all their activities within professional framework and be accountable for every action they take. RERA is expected to bring structure and seamlessness into the work environment of brokers. As a buyer, it would become easier for them to trust the brokers and jotting down of all guidelines in a documented manner is going to help them make cognitive choices.
RERA is going to make real estate brokers more accountable for their way of working. Going forward, agents would have to commit the timelines for completing the selling or buying process. They would be asked to furnish reasons for delay. An advisory committee is also being established that would listen to their side of story. The aim of bringing brokers under the aegis of RERA is to make them knowledgeable enough to qualify for carrying out the sales process of such magnitude.
Therefore, a broker would be deemed RERA compliant when he gets the requisite license. This license would be furnished only after the broker finishes a certification program enabling him to know all about the real estate dealings. Also, the real estate broker would be required to renew the license annually. Thus, instances of buying processes getting unduly delayed will be avoided to an appreciable extent with RERA register brokers.
Since there were no regulatory framework present, the brokers had a chance to play with the trust of the parties who approached them for a property deal. A number of instances have been reported in the past where brokers tried to sell the property with unclear titles, or property under dispute. The buyer had to bear the brunt of this malpractice; brokers did not hesitate to put the interests of the buyers on stake for the sake of some faster bucks. RERA registered brokers would be required to document every deal closed by them. This documentation is going to safeguard the interests of the buyers in many ways. Not only it would help them get fair price quotes for the property, but also they would have assurance of clarity about the property title and other details.
A buyer cannot put his life on hold for closing a property deal. He expects the real estate agent to do all the survey and enquiries on his behalf. Due to RERA impact on real estate agents, a broker would not be able to hide anything from the client. Since the client would have right to ask for RERA compliance of the project suggested to him, and also would have freedom to go to an authority to verify the details, the whole process of buying and selling is going to become more transparent than ever. Client would know exactly what he is getting into and would be clear on price, status and timeline.
Code of conduct
RERA will outline the code of conduct for the brokers. They would have to have a documented way of working. Every promise made to the buyer will be stated in crystal clear fashion in the form of document. Documentation is important and with the RERA impact on agents, it would benefit the customers who fall prey to the rosy pictures painted by the brokers. They cannot promise anything that is outside the document provided by the selling party. So, professionalism and better responsibility are going to rule the working style of real estate agents post RERA.
Current Status of RERA implementation
The idea is superb, undoubtedly! But, how far it is implemented is what is going to change the scenario actually. According to reports provided by a leading online daily, only 70 brokers have registered with the RERA so far. The biggest challenge posed to implementation is by the reluctance prevalent amongst the states as well as unorganized brokers. They find the registration fees too high and feel that the penalties for non-compliance are disproportionately high. Their fear of losing on profit margin is the biggest hurdle to implementation. Thus, to make the initiative a success, it is essential for the visionaries to organize RERA awareness campaigns so that the buyers also go for only RERA compliant brokers, and the brokers also understand the gravity of not complying with this regulatory guideline.
For those who want to know what the registration fees are, here is the classification:
- Rs 1, 00,000 for society, partnership firm, private Ltd/Ltd company, LLP, etc.
- Rs 10,000 for proprietor, individual, or proprietorship firm.
- Rs 500 to Mahaonline for Maha-Rera website (plus taxes and bank charges, if any).
Indian real estate holds lot of promise for the country’s economic growth. But, no-filter situation was not allowing this sector to deliver to it’s truest potential. RERA is designed to organize such a large chunk of unregulated brokers. It can become successful only if it is implemented with full force and within correct timeline.
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