Real Estate Regulation Act (RERA) India | Rules, Benefits, Registration & Compliance Guide
The Real Estate Regulation Act (RERA) is a landmark Indian law passed in 2016 to regulate the real estate sector, increase transparency, and protect homebuyers from fraud and delays. Before RERA, buyers often faced issues like delayed project possession, misleading advertisements, wrong area measurements, and lack of legal accountability. With the implementation of the Real Estate Regulation Act, the Indian real estate industry became more organized, accountable, and consumer-focused.
If you’re a homebuyer, real estate agent, developer, or investor, understanding the Real Estate Regulation Act is essential for safe property transactions and compliance.
What Is the Real Estate Regulation Act?
The Real Estate Regulation Act (RERA) is a central law enforced by the Government of India to regulate real estate projects and ensure fairness between buyers and developers. It mandates project registration, timely delivery, financial accountability, dispute resolution, and transparency in real estate dealings.
The act applies to:
- Residential real estate projects
- Commercial real estate projects
- Real estate agents and property sellers
Objectives of the Real Estate Regulation Act
The primary goals of the Real Estate Regulation Act include:
| Objective | Purpose |
| Protect homebuyers | Prevent fraud and ensure timely possession |
| Increase transparency | Mandatory project disclosure and approvals |
| Regulate builders and agents | Ensure professionalism and accountability |
| Promote fair transactions | Standard rules for sale, area, and agreements |
| Establish dispute resolution | Fast legal remedy through RERA tribunal |
Features of the Real Estate Regulation Act (RERA)
Here are the most important provisions every buyer and developer must know:
1. Mandatory RERA Registration
All real estate projects exceeding 500 sq. m. or with more than 8 housing units must register with the state’s RERA authority before advertising or selling.
Penalties for selling without registration:
❌ ₹10 lakh fine or up to 3 years imprisonment
2. 70% of Funds Must Be Kept in Escrow Account
Builders must deposit 70% of the project funds into a dedicated bank account, ensuring:
- No diversion of funds to other projects
- Faster and safer completion
- Financial transparency
3. Carpet Area Standardization
Before RERA, builders used super built-up area to inflate prices.
Under RERA, pricing must be based on carpet area only.
Carpet Area Meaning:
🟢 Area inside walls — usable floor space
❌ No lobby, lift, garden, or common areas included
4. Timely Construction and Possession
If a project is delayed beyond promised timelines, the buyer may:
- Claim full refund + interest
- Stay invested and receive compensation
5. Legal Accountability and Penalties
Builders, brokers, or agencies violating rules face:
| Violation Type | Penalty |
| Advertising unregistered project | Up to ₹10 lakhs |
| Non-compliance with RERA orders | Up to 3 years imprisonment |
| Misleading information | Heavy fine + license cancellation |
6. Strong Dispute Resolution Mechanism
Disputes are handled by:
- RERA Authority
- RERA Appellate Tribunal
Most cases resolve within 60–120 days, making real estate dispute settlement faster than courts.
Rights of Homebuyers Under the Real Estate Regulation Act
| Buyer Right | Explanation |
| Right to project details | Layout, approvals, builder history, RERA certificate |
| Right to timely possession | Legal protection against delays |
| Right to refund/compensation | If builder cancels or delays |
| Right to legal remedy | Quick dispute resolution through tribunal |
| Right to standard agreement | No hidden clauses allowed |
Responsibilities of Builders and Developers
Under RERA, developers must:
- Provide accurate project timelines
- Update construction progress quarterly
- Use sanctioned plans only
- Correct defects found within 5 years of possession (defect liability clause)
Rules for Real Estate Agents Under RERA
Real estate brokers must:
- Apply for RERA agent registration
- Follow ethical sale practices
- Avoid misrepresentation
- Renew license periodically
Unregistered agents cannot legally sell any RERA-registered property.
How to Check RERA Registration Online? (Step-by-Step)
- Visit the respective State RERA website
- Choose “Project Registration”
- Search by:
- Builder name
- Project name
- RERA registration number
- Verify:
- Approvals
- Timeline
- Compliance updates
✔ This helps avoid fraudulent or illegal real estate projects.
Benefits of the Real Estate Regulation Act
| Beneficiary | Benefits |
| Homebuyers | Security, transparency, legal protection |
| Developers | Credibility, faster sales, regulated ecosystem |
| Government | Organized real estate sector |
Effects of RERA on the Indian Property Market
The implementation of the Real Estate Regulation Act has resulted in:
- 🔹 Rise in buyer confidence
- 🔹 Elimination of fraudulent projects
- 🔹 Faster project completion rates
- 🔹 Increased investment transparency
- 🔹 Growth in organized housing market
States With Strong RERA Compliance
Some of the leading states in RERA enforcement include:
- Maharashtra (MahaRERA)
- Uttar Pradesh (UP-RERA)
- Karnataka (KRERA)
- Gujarat (GUJRERA)
- Telangana RERA
- Rajasthan RERA
- Haryana RERA (HRERA)
(Maharashtra has the highest number of registered projects and agents.)
Latest Updates to the Real Estate Regulation Act
- Digital project tracking via dashboards
- Mandatory quarterly updates
- Penalty enforcement against non-compliant developers
- Increasing adoption for commercial real estate
Conclusion
The Real Estate Regulation Act has transformed the Indian real estate landscape by improving transparency, regulating transactions, and protecting homebuyers. Whether you’re purchasing property, investing, or working as a real estate agent, compliance with RERA is essential to avoid legal risks and ensure secure transactions.
FAQs About the Real Estate Regulation Act
RERA is a regulatory law introduced to protect buyers and regulate the real estate sector.
Yes — if a project is over 500 sq. m. or has more than 8 units.
Buyers can claim a refund with interest or compensation.
Check the project specifics on the respective state RERA website.
Yes — complaints can be submitted online on the state’s portal.
Carpet area is usable area inside walls; super built-up includes common spaces.
No — it is illegal and penalized.
Yes — commercial and residential projects are covered.
Yes — taxation transparency is part of buyer rights.
It remains valid until the project completion timeline submitted during registration.
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