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RERA and agent: The real connection

Saturday, June 02, 2018

The role of a real estate agent in property transactions will always remain significant. And, with RERA coming in, the agents will now be bound to deliver legally. Advocate Tanmay Ketkar explains the current scenario

Middlemen, being connecting link between the demand and supply side, is an essential element in business and real estate business is no exception to this. The real estate agents and their role and services cannot be neglected. The real state agent continues to facilitate the property transaction of all types i.e. buying, selling, renting, leasing etc. In spite of its pivotal role in transactions, none of the Act legally recognised the real estate agent.

Recognition and definition of real estate agent is one of the key features of RERA. The term 'real estate agent’ has been defined in section 2 of the Act. Accordingly, any person connecting the buyer and seller, helping them in transaction, for a consideration is a real estate agent.

‘Legal’ agent
To deal or to act as real estate agent in project registered under section 9 of RERA, a real estate agent must be registered under the MahaRERA. Since there is separate RERA Authority for every state a real estate agent operating in more than one state, needs to be registered in every state of operation. If the agent is natural person the registration fee is Rs 10,000/- and if the agent is an artificial person i.e. company, partnership, LLP etc. the fees for registration is Rs 1,00,000/-. The registration is valid for five years and thereafter is required to be renewed.

Every registered agent needs to follow some rules and regulations. Accordingly, a registered agent cannot act as an agent for unregistered project. A registered agent is required to display the registration certificate in conspicuous space and all the communication, letterhead, bills of agent shall bear the registration number. A registered agent is required to keep the record of all the transactions facilitated. Any contravention of the rules, regulations, or other provisions would attract the fine up to Rs 10,000/- per day. However, the fine will not exceed the 5% of total price of the unit involved.

Registration mandatory
Registration of agent being mandatory, now the builder and developer can appoint only the registered agents and not the unregistered agents. If an agent is appointed, his details shall be displayed on web page of the project maintained on MahaRERA website.

Registration is mandatory for dealing or acting as agent in registered projects, which in turn means no such registration is required for dealing or acting as agent in projects not registered or exempted from registration. Therefore, no such registration is required for dealing or acting as agent in transactions of open land, agricultural land, resale of properties. An agent working in only resale property or land or projects outside of purview of registration need not be registered. However, an agent working in both projects within purview of registration and outside purviews of RERA is required to be registered.

Considering the dispute redressal under RERA, complaint against registered agent only, can be filed before MahaRERA. No such complaint against unregistered agent will be entertained by MahaRERA.

In nutshell, an essential element such as real estate agent has now been given separate legal identity by RERA, which is certainly a welcome move. Legal identity and regulatory mechanism will surely pave the way for the growth of this sector.

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