In an effort to protect homeowners and reduce their financial risk during development, the Maharashtra government intends to prohibit developers from collecting the total property consideration before the project achieves final completion registration. Under the idea, developers might receive up to 80% of the total consideration when signing the Agreement for Sale (AFS), with the remaining 20% due upon project completion and official registration.<\/p>\n\n\n\n
According to Maharashtra Revenue Minister Chandrashekhar Bawankule, the state is exploring a law amendment that would allow developers to receive 75% to 80% of the total property value during the agreement-to-sell stage, with the remaining 20% paid at the time of final registration.At the time of the selling agreement, developers will be able to collect no more than 75% to 80% of the payment from homebuyers. The remaining 20% will be collected from homebuyers upon final registration. Going forward, we want to call for final registration and change the Registration Act. It will no longer be the situation that registration is done and money is taken from homebuyers with no guaranty that construction would be completed,” Bawankule stated in a video shared on his X account.<\/p>\n\n\n\n
According to Section 13(1) of the Real Estate Regulatory Act (RERA) Act, 2016, a promoter cannot collect more than 10% of the cost of an apartment, plot, or building as an advance\/application fee from an allottee without first entering into and filing a formal Agreement for Sale.<\/p>\n\n\n\n
The MahaRERA has also stated in its FAQs that even if a buyer freely agrees to pay more than 10% without registering the agreement, the promoter will not accept such payment. Therefore, once the sum collected exceeds the 10% level, a registered Agreement for Sale is required.<\/p>\n\n\n\n
However, neither the RERA Act nor MahaRERA currently impose a maximum limit on the total amount a developer can collect from an allottee during the construction period, as long as the payments are in accordance with the registered Agreement for Sale and other relevant conditions.<\/p>\n\n\n\n
According to Maharashtra government officials, the planned reform is intended to address a long-standing problem among homebuyers, particularly those acquiring under-construction properties, who may end up paying a significant chunk of the apartment’s cost before getting possession. According to the proposed framework, the buyer would keep at least 20% of the consideration until the property is fully registered.<\/p>\n\n\n\n
Bawankule explained that the proposed regulation was meant to protect flat buyers and decrease their financial exposure throughout the construction phase.<\/p>\n\n\n\n
Officials from the Maharashtra government said that the plan should not be construed as an immediate rule for developers. The government is exploring a modification in the law, and the specific wording, applicability, and implementation mechanism will be determined by the legislation that the state eventually submits and passes through the state legislature.<\/p>\n\n\n\n
From RERA reforms and homebuyer rules to property prices, redevelopment and new projects, get the latest real estate news and insights with IndexTap<\/a><\/strong>.<\/p>\n","protected":false},"excerpt":{"rendered":" In an effort to protect homeowners and reduce their financial risk during development, the Maharashtra government intends to prohibit developers from collecting the total property consideration before the project achieves final completion registration. Under the idea, developers might receive up to 80% of the total consideration when signing the Agreement for Sale (AFS), with the […]<\/p>\n","protected":false},"author":1,"featured_media":3545,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"site-container-style":"default","site-container-layout":"default","site-sidebar-layout":"default","disable-article-header":"default","disable-site-header":"default","disable-site-footer":"default","disable-content-area-spacing":"default","footnotes":""},"categories":[9],"tags":[],"class_list":["post-3544","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog"],"aioseo_notices":[],"aioseo_head":"\n\t\t\n\t\n\t\n\t\n\t\n\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t