How RERA is Shaping the Indian Real Estate Market

RERA (Real Estate Regulatory Authority) was established under the Real Estate (Regulation and Development) Act, 2016 to:

• Protect homebuyers' interests.
• Promote transparency and accountability in the real estate sector.
• Regulate real estate projects and ensure timely delivery.

The Act mandates that all residential and commercial real estate projects with an area of more than 500 square meters or more than 8 apartments must be registered under RERA. Developers are now required to upload project details such as:

• Project layout plan.
• Approvals from authorities.
• Construction status.
• Expected completion date.

This transparency has brought trust and confidence among homebuyers.

One of the biggest changes brought by RERA is transparency in real estate transactions. Developers are now:

• Required to disclose project details on the RERA portal.
• Upload quarterly progress reports.
• Mention carpet area instead of super built-up area.

This has significantly reduced the cases of false promises and misleading information provided by developers. Buyers now have full access to accurate project information, ensuring they make informed decisions.

Before RERA, delayed project delivery was one of the biggest challenges in the Indian real estate market. Under RERA:

• Developers are now legally bound to complete the project within the committed timeline.
• If the project gets delayed, homebuyers are entitled to compensation or a full refund.
• Developers have to deposit 70% of the project funds in an escrow account, ensuring that the money is used only for construction purposes.

This step has:

• Reduced project delays.
• Increased customer confidence.
• Ensured timely delivery of projects.

Earlier, many homebuyers fell victim to false promises made by builders regarding:

• Project layout.
• Possession date.
• Amenities and facilities.

However, under RERA, developers are:

• Legally obligated to deliver what they promise.
• If the project is different from what was promised, the buyer can either claim a refund or compensation.
• Builders can no longer advertise or sell unapproved projects.

This has significantly reduced fraudulent activities in the real estate market.

Before RERA, developers often advertised the super built-up area (which includes walls, balconies, etc.) instead of the carpet area (usable area inside the house). This led to confusion and financial losses for homebuyers.

Under RERA:

• Carpet area is now the only valid measurement.
• Buyers can compare properties easily based on actual living space.
• It prevents overcharging by developers.

This has brought clarity and transparency in property transactions.

Delayed projects were a common problem in India. However, under RERA:

• If a project is delayed, the developer has to compensate the buyer with monthly interest.
• In case of project cancellation, the developer must refund the full amount with interest.

This provision has made developers more cautious about committing false deadlines and ensuring timely project completion.

Before RERA, homebuyers had no proper forum to lodge complaints against developers. However, RERA introduced a strong grievance redressal system:

• Homebuyers can file complaints directly with the RERA authority.
• The authority is required to resolve the issue within 60 days.
• If not satisfied, buyers can approach the Appellate Tribunal.

This mechanism has empowered homebuyers and improved accountability.

The implementation of RERA has boosted investor confidence in the real estate market. Earlier, many investors hesitated due to:

• Lack of transparency.
• Project delays.
• Mismanagement of funds.

However, with RERA:

• Investors now see low-risk and high returns in real estate.
• Foreign Direct Investment (FDI) has increased in Indian real estate.
• Real estate developers are adopting ethical practices to attract investors.

This has significantly contributed to the growth of the real estate sector.

Before RERA, the balance of power was largely in favor of developers. However, RERA has shifted the balance towards homebuyers.

• Developers now have to comply with regulations.
• Buyers have the right to know every project detail.
• In case of any dispute, the buyer can easily claim compensation.

This balance has brought mutual trust and improved market credibility.

RERA does not only regulate developers but also real estate agents. Under RERA:

• Real estate agents must register with the RERA authority.
• They are prohibited from misleading buyers.
• Agents must provide accurate project information.

This has reduced misinformation and improved the credibility of property transactions.

Due to RERA's strict regulations, the Indian real estate market is becoming:

• More organized and transparent.
• Favorable for investors and buyers.
• Less prone to fraud and delays.

As a result:

• Foreign investment in real estate is increasing.
• Developers are focusing on quality construction and timely delivery.
• Buyers have higher confidence in purchasing properties.

This has significantly contributed to the overall growth and stability of the real estate market.

Although RERA has positively impacted the real estate market, there are still some challenges:

1. Delayed registration of projects in some states.
2. Lack of awareness among homebuyers about RERA benefits.
3. Some developers still violate RERA guidelines.
4. Lengthy dispute resolution in some cases.

However, as the government continues to strengthen RERA's implementation, these challenges are expected to reduce over time.

RERA has undoubtedly brought a revolution in the Indian real estate sector by promoting transparency, accountability, and fairness. It has:

• Restored homebuyers' trust.
• Ensured timely project delivery.
• Protected buyers from fraudulent practices.

In the coming years, RERA will continue to play a pivotal role in shaping a safe, transparent, and investor-friendly real estate market in India.