Government extends term of six months for real estate projects
NEW DELHI: In a relief to real estate developers, the finance minister said Wednesday that the deadline for project completion will be extended to six months, treating the outbreak as a 'force majeure' event under the law on RERA real estate.
Urban affairs will issue a notice to real estate regulators in all states and will treat Covid-19 as an act of God so that 'force majeure' clauses under RERA can be invoked to provide relief to builders on completion of projects .
The relief will be granted to all projects registered under the Real Estate Law (Regulation and Development), called RERA, which expires on or after March 25, the date from which the national blockade to control the coronavirus.
The real estate industry has been demanding that the deadline for project completion be extended by at least six months as construction work was halted due to the closure.
In announcing the decision, Sitharaman said the Ministry of Housing and Urban Affairs will advise States and their regulatory authorities to treat Covid-19 as a Force Majeure event under RERA.
Regulators can extend suo's motto of the registration and completion date by six months for all registered projects that expire on or after March 25 without individual applications, he said.
Authorities can grant an additional three-month extension if necessary.
Regulators must issue new project registration certificates automatically with revised deadlines. The deadlines to comply with other legal compliance under the RERA must be extended accordingly.
These measures will de-stress real estate developers and ensure completion of projects so that home buyers can receive their reserved homes with new deadlines, the minister said.