One of the greatest challenges commonly faced by a home buyer in India is the frequent delays in the possession of property. Homes that were otherwise promised would remain unfulfilled by an on-time delivery of houses by developers, leaving buyers with an all-round financial and emotional strain. However, with the coming into force of the Real Estate (Regulation and Development) Act (RERA), 2016, this field has changed considerably.
What under RERA is Delayed Possession?
According to RERA, the developer must register the projects with the regulator and mention a fixed date for the possession. After that, the possession date, the developer becomes legally bound to deliver the property on the time stated. Failing on the part of the developer will be liable for compensation to the homebuyer for such delayed possession.
Compensation Due to Delay in Possession
In case of a delay in the possession date by the developer, the homebuyers shall be entitled to compensation in the form of interest on the amount paid by the buyer. The interest rate is generally the highest lending rate of State Bank of India (SBI) applicable plus 2%. This interest is applicable for each month of delay counting from the possession date till actual handover of the property.
In case of serious delays, the customer will also be entitled to cancel the booking and claim a refund with complete compensation for the delay.
How does it bring benefits for home buyers?
Financial Security: In case of delays, homebuyers are given a guarantee to assure payment of interest thus protecting the financial interests.
Accountability: Home builders are now expected to meet project timelines, thereby guaranteeing on-time delivery.
Legal Guarantee: RERA's dispute resolution process can be used by homebuyers to claim compensation, making the process easier.