Relief for homebuyers: Karnataka notifies new format for sales agreements

The new rules mandate a proper format for sales agreements in Karnataka, which will also ensure that builders cannot charge buyers any extra costs over and above the amount agreed upon.
Relief for homebuyers: Karnataka notifies new format for sales agreements
Relief for homebuyers: Karnataka notifies new format for sales agreements

After a delay of three years, the Karnataka government has notified the new rule for Agreement for Sale of property in accordance with the  RERA (Real Estate Regulatory Authority) Act, much to the relief of home buyers.

 At present, often builders would make sales agreements according to their own whims and fancies without taking note of the buyers’ interests, but with the new rules notified, a uniform sale agreement format has to be followed.

Elaborating on this, Shankar Srinivasan (convener of Karnataka Chapter - Fight for RERA) said, “This agreement, now which will be followed across the Karnataka state, is going to benefit all homebuyers of every economic class. The agreement format will guarantee it will be balanced and not only favour the builder as often it used to be. This will make the deal much more transparent and hold the builder accountable.”

He added that often, builders would ask buyers to pay over and above the agreed amount citing hike in prices of materials or any excuse that they could manage. Even the delivery date of the property would also be not explicitly mentioned. He said that there will be a mandatory clause of guaranteeing structural integrity of five years for all buildings.

He added, “With this, the builder cannot charge the buyer any extra costs towards government charges or development fee.”

This development has been warmly welcomed by homebuyers who feel that these new rules will be beneficial, as often homebuyers are shortchanged by builders during the delivery of property.

“We are thankful to the Shri V Somanna, Hon'ble Minister for Housing and the initiatives of Karnataka Government Secretary Shri Manoj Kumar Meena IAS and the Chairman Karnataka Rera who have compiled and suggested undiluted Rules for notification,” MS Shankar, General Secretary, Forum for Peoples Collective Efforts, said.

He added, “Though delayed for more than three years but it is worth waiting for the buyers. The earlier versions of draft rules had a lot of dilution and we have opposed notification of the same and have been insisting for undiluted version notification of ‘agreement for sale’ as per model agreement notified by Government Of India.”

Forum for Peoples Collective Efforts had also submitted a memorandum to push for the same in November 2019.

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