For decades, buying property in India was considered a high-risk venture, especially for first-time homebuyers. Stories of delayed possession, incomplete projects, misleading advertisements, and fly-by-night developers were all too common. There was a glaring need for a structured framework that would instill accountability, promote transparency, and restore buyer confidence. That’s exactly what the Real Estate (Regulation and Development) Act, 2016, or RERA, set out to achieve.
In this blog, we’ll explore RERA’s role in protecting homebuyers, understand how it has changed India’s real estate ecosystem, and why any buyer—whether in Pune, Mumbai, or Bangalore—should care deeply about RERA compliance before making a purchase decision.
What Is RERA?
The Real Estate (Regulation and Development) Act, 2016, commonly known as RERA, is a landmark law enacted by the Government of India to regulate the real estate sector. It came into effect on 1st May 2017, with the primary aim of protecting the interests of homebuyers and bringing transparency to the housing sector.
Under RERA, each state and union territory was required to set up its own regulatory authority to oversee and enforce the provisions of the Act. Developers are now obligated to register their projects with RERA before advertising or selling them.
Why Was RERA Needed?
Before RERA, the Indian real estate market was largely unregulated. Developers operated with minimal oversight. Buyers had little recourse if things went wrong, and legal remedies often took years in civil courts.
Here are a few major issues that plagued homebuyers:
Project delays of 5–10 years were common.
Builders often changed plans after booking without informing buyers.
There was no standardized definition of carpet area, leading to pricing confusion.
Advance payments were made without clarity on completion.
Exit clauses heavily favored the builder, not the buyer.
RERA was designed to address these systemic issues, providing a clear regulatory framework that defines the rights of buyers and duties of developers.
Key Provisions of RERA That Protect Homebuyers
1. Mandatory Project Registration
All residential and commercial projects exceeding a certain size must be registered with the respective state RERA authority. Builders cannot advertise, market, or sell any unit in a project that is not registered.
Why it matters:
Buyers can now verify a project’s legal status, ownership title, approvals, and construction timeline through the RERA portal, ensuring transparency from day one.
2. Advance Payment Cap
Under RERA, a developer cannot demand more than 10% of the property’s cost as an advance before signing a sale agreement.
Why it matters:
This protects homebuyers from excessive financial exposure in the early stages and ensures proper legal documentation before major payments are made.
3. Defined Carpet Area
RERA introduced a standardized definition of carpet area, which is the net usable floor area of an apartment (excluding walls, balconies, etc.).
Why it matters:
Builders can no longer mislead buyers by quoting built-up or super built-up area. Buyers now pay only for what they use.
4. Escrow Account for Project Funds
Developers must deposit 70% of the project funds collected from buyers into a separate escrow account. These funds can only be used for that specific project’s construction and land cost.
Why it matters:
It prevents developers from diverting funds to other ventures and ensures the timely completion of the project.
5. Timely Delivery or Compensation
RERA holds developers accountable to the project completion date committed at the time of registration. If there is a delay, the buyer is entitled to interest or refund.
Why it matters:
Buyers are no longer helpless in case of delays. They can either wait and receive interest compensation or choose to withdraw and get a refund.
6. Defect Liability Period
Builders are liable to fix structural defects or poor workmanship reported by the buyer within five years of possession, at no extra cost.
Why it matters:
This provides post-possession protection and holds developers accountable for the quality of construction.
7. Fast-Track Dispute Resolution
RERA establishes a dedicated Appellate Tribunal for resolving disputes between buyers and developers within 60 days.
Why it matters:
Homebuyers get a quicker, more affordable legal remedy compared to prolonged litigation in civil courts.
How RERA Has Changed the Real Estate Landscape
● Increased Buyer Confidence
With rules now favoring transparency, more Indians feel confident about investing in real estate, especially first-time buyers.
● Elimination of Fly-by-Night Builders
Unscrupulous developers are gradually being weeded out, as they can no longer launch or promote projects without approvals.
● Data Availability for Buyers
Buyers can now research a project's background, status, and approvals through state RERA websites, making informed decisions.
● Project Accountability
Every stage of construction, delay, or change has to be updated on the RERA portal, creating a digital trail that keeps developers honest.
Real-Life Impact: The Maharashtra RERA Example
Maharashtra was one of the first states to implement RERA effectively. In the years since its implementation, it has:
Registered over 36,000 real estate projects
Resolved thousands of buyer complaints through MahaRERA Tribunal
Increased real estate registration transparency via public access portals
Cities like Pune and Mumbai, which saw a surge in delayed and abandoned projects earlier, have reported significantly higher buyer satisfaction and project delivery rates post-RERA.
Why Homebuyers Should Prioritize RERA-Registered Projects
If you're a buyer planning to invest in a property — whether under-construction or ready-to-move — here’s why you should always verify RERA registration:
Ensures legal title and approved plans
Protects your money from diversion
Provides a legal route for compensation
Increases your resale value due to trust and compliance
Improves chances of bank financing and loan approvals
Many new residential and mixed-use projects, like the ones you see in fast-growing metros and tier-2 cities, prominently feature their RERA registration number as a mark of trust.
How to Verify a Project’s RERA Details
Most states have launched their own RERA portals. Here's how you can verify a project:
Go to your state's RERA website (e.g., https://maharera.mahaonline.gov.in)
Enter the project name, promoter name, or RERA registration number
Check status updates, documents, layout approvals, and delivery schedule
This simple step can protect you from years of financial stress and legal battles.
Challenges Still Remaining
While RERA has brought significant improvements, there are still challenges:
Some states have diluted implementation or delays in Tribunal hearings.
Penalties imposed on builders are not always enforced properly.
Not all ongoing or smaller projects are covered under the Act.
Nevertheless, RERA is a crucial step forward, and the central government continues to push for tighter implementation and better buyer protection.
Final Thoughts
RERA has fundamentally changed the buyer-developer relationship in India. It has shifted the balance from one-sided contracts and opaque practices to accountability, fairness, and transparency. If you’re a buyer, it’s no longer just a luxury but a necessity to ensure the property you’re investing in is RERA-registered.
Whether you're buying your dream home or investing in a high-potential project, your first step should always be: Check the RERA number.
Want to explore secure, compliant real estate projects? Always start your journey with transparency—and RERA is your strongest ally in that process.
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