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In a significant move, the Uttar Pradesh Real Estate Regulatory Authority (UP RERA) has issued a clear directive to housing project developers in the state, instructing them to adhere strictly to the sale of units or apartments based on the carpet area, as stipulated by the Real Estate (Regulation and Development) Act, 2016.
According to the provisions of the RERA Act, promoters are mandated to register their projects on the portal, providing comprehensive details regarding the number and types of units. This includes specifications such as floor, balcony, terrace, and crucially, the actual floor space among internal walls, commonly referred to as the Carpet Area. Additionally, the UP RERA portal has introduced a model agreement for sale, emphasizing the use of the carpet area as the basis for transactions.
The UP RERA has underscored that any sale of apartments based on the 'super area' is not only against the provisions of the RERA Act, but is also deemed illegal. The UP RERA emphasized that the term 'super area' finds no mention or definition within the RERA Act. According to the official statement, the buying and selling of apartments are legally sanctioned exclusively on the basis of the carpet area.
Sanjay Bhoosreddy, the Chairman of UP RERA, stressed the imperative for allottees to consider the carpet area as the authentic measurement of the unit or apartment, highlighting that promoters must ensure the sale of units is aligned solely with the carpet area. The UP RERA has also explicitly warned that any violation of this provision could lead to consequences for the promoters involved.
Alongside, the UP RERA issued another advisory on the payment module for projects, reminding both developers and buyers that no advance should be made unless the sale agreement is executed. It quoted Section 13 of the UP-RERA Act to inform homebuyers that no developer can take an advance of more than 10% of the total cost of a flat, plot or building. It clearly stated that this advance can only be taken after the builder-buyer agreement has been signed.
This advisory is for both promoters and homebuyers on how and when to make payments. Officials said the advisory followed multiple complaints about the way builders had been taking advance payments. In some cases, buyers were being made to pay more than 10% as advance while in other instances, they were being told to pay even before the sale agreement had been signed.
The RERA clarified that the sale agreement is meant to contain all details about the project, such as the dates of constructions and particulars about internal development work as well. It should also list the important dates regarding payments and the manner in which they should be made. The date of possession should be mentioned as well. Apart from these, the rate of interest that a promoter or an allottee should pay in case of defaults should also be specified in the agreement.
These directives are meant to uphold transparency and ethical practices within the real estate sector, safeguarding the interests of homebuyers and aligning the practices of housing developers with the legal framework established by the RERA Act. By ensuring adherence to the carpet area as the sole basis for transactions, and ensuring that agreements and advance payments are in-line with established practices, the UP RERA aims to foster a fair and transparent environment in the real estate market, thereby promoting consumer confidence and trust in the sector.
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