Before the enactment of the RERA Act, the only remedy which was available for disputes involving real estate was to approach the court and wait for several years. The Act has made it easier for people to resolve disputes in a less expensive and timely manner. The primary purpose for which the law was enacted was to restore the confidence of the customers in the Real Estate sector by introducing transparency and accountability.

The Act covers new projects and those projects where the completion certificate is not issued on the date that the Act comes into force. The Act establishes a separate authority for the disputes that may arise out of real estate projects. Civil courts do not have the jurisdiction to entertain any suit or proceeding in respect of any matter which either RERA or the adjudicating officer or appellate tribunal have the jurisdiction to entertain.

The Real Estate Act makes it mandatory for all commercial and residential real estate projects where the land is over 500 square meters, or eight apartments, to register with the Real Estate Regulatory (RERA) for launching a project, in order to provide greater transparency in project-marketing and execution.

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What if the property is not RERA registered?

The RERA Act was established to provide transparency and accountability in the real estate sector. It ensures that the builder has complied with the necessary rules and regulations that are to be followed in a real estate project. It provides the customers with a forum for addressing any dispute with a real estate project in a less expensive and timely manner.

Buying property that is not registered under RERA poses a grave threat to buyers. Banks stop funding the project at the project level or at the retail level. RERA aims to create a more equitable and fair transaction between the seller and buyer of properties. It brings about better transparency and accountability. 

Is it safe to buy a RERA approved project?

Buying a RERA approved project ensures that the rights of the buyer are protected. It strives to bring transparency in the sector by ensuring:

  • That the developer has to deliver what has been promised. The builder will also have to disclose every detail about the project – like the number of units, carpet area of each unit, etc.
  • The developer will have to transfer 70% of the money received from homebuyers into an escrow account. This will ensure that the money meant for a particular project is not used to finance other projects.
  • Homebuyers will pay only for the carpet area and builders cannot charge for the super built-up area, as was the practice until now.
  • Developers will be able to sell their projects only after necessary clearances.
  • The amenities and specifications that a developer promises have to be present in the project. He cannot make any changes to the plan without the written consent of buyers.
  • The builder will have to provide for any structural defect in the building for five years, from the time possession is given. They will have to rectify the structural defect without any further charge.
  • In case of delay in the project, the developer will pay the same interest to the consumer as the EMI being paid by the consumer to the bank.
  • In case of any deficiency in the project, the buyer can contact the developer in writing within one year of taking possession of after-sales service.

Is RERA applicable to land developers?

Builders/developers will not be able to sell any new project without first registering their project with the RERA. The Act provides that no developer or builder shall advertise, market, book, sell or offer for sale, or invite persons to purchase any plot, apartment or building, in any real estate project or part of it, in any planning area, without registering their project with the Real Estate Regulatory Authority (RERA).

Are there any specific rules for buyers who do not follow RERA laws? 

The RERA Act has made it mandatory for all the ongoing and new projects to register with respective RERA Authorities. This registration is mandatory as it provides transparency and accountability between the sellers and buyers and protects the rights of the buyers from the acts of the sellers. In the case of non-registration, they will attract penalties under the Act. 

The penalties imposed on buyers who do not follow RERA laws are:

  • If a potential buyer fails to follow or contravenes any of the orders, decisions, or directions of the Authority, he shall be liable to a penalty till the time the default occurs. This penalty may cumulatively extend up to 5% of the plot, apartment, or building cost.
  • If a potential buyer fails to follow or contravenes any of the orders, decisions, or directions of the Appellate Tribunal, he shall be punished with imprisonment up to 1 year or with a fine every day till the time the default exists. This may cumulatively extend up to 10% of the plot, apartment, or building cost. There may be both imprisonment and fines imposed in certain cases.


It can be seen that the RERA Act is a step in achieving a regulated real estate sector and bringing transparency to real estate transactions. It is an initiative to protect the interests of the buyers by providing safety against exploitation by the promoters or builders. RERA requires builders to provide information regarding their establishments. It includes the submission of the type of venture, registration certificates, business certificates. This is to ensure that the builder has been involved in other projects and is trustworthy. 

The requirement of seeking approval of RERA in real estate projects keeps the buyers informed about the developments of the real estate project. Builders are required to keep the buyers informed through the RERA website on the status of construction, status of approvals, project amendments/modifications to the original plan if any, etc. It also imposes strict punishment on builders and promoters when they do not comply with the rules and regulations that have been laid down by RERA.