Understanding RERA Act

Everything you need to know about the Real Estate (Regulation and Development) Act, 2016. A complete guide for buyers, developers, and agents.

The Law

The RERA Act of 2016

Before 2016, the Indian real estate sector was largely unregulated, leading to project delays, unaccountable builders, and a lack of transparency. Homebuyers were often left in the lurch with no proper grievance redressal mechanism.

To address these challenges, the Real Estate (Regulation and Development) Act was enacted. It serves as a dedicated regulatory body to ensure efficiency, transparency, and accountability in the real estate sector.

Core Objectives

  • Protect Homebuyers

    Establishes a fast-track mechanism for grievance redressal against default or delays.

  • Ensure Transparency

    Mandates registration of all projects with clear timelines and layout plans.

  • Boost Investment

    Reinforces trust in the sector by enforcing strict financial discipline on developers.

1Key RERA Rules

Carpet Area Standardization

Builders must sell flats based on carpet area, not super built-up area. This ensures you pay only for the usable space within the walls.

Advance Payment Cap

A promoter cannot accept more than 10% of the cost of the property as an advance payment or application fee without entering into a written agreement for sale.

70% Fund Reserve

Developers must deposit 70% of the amount realized from buyers in a separate bank account to cover the cost of construction and land cost.

Defect Liability

In case of any structural defect within 5 years of possession, the builder must rectify it free of charge within 30 days.

2Registration Process

1
Prepare Documents
Gather all necessary legal and financial documents as prescribed by your state's RERA authority.
2
Visit Official Portal
Go to your respective state's RERA website (e.g., MahaRERA, UP RERA).
3
Submit Application
Fill out the registration form (Form A for promoters, Form B for agents) and upload documents.
4
Pay Fees
Pay the requisite registration fee online as per your project type or agent category.

3Documents Required

For Builders
  • PAN Card Copy
  • Balance Sheet (Last 3 Years)
  • Income Tax Returns (Last 3 Years)
  • Land Title Documents & Search Report
  • Approved Project Plan & Layout
  • Encumbrance Certificate
For Agents
  • PAN Card Copy
  • Aadhaar Card / Address Proof
  • Income Tax Returns (Last 3 Years)
  • Details of Enterprise (LLP, Company, etc.)
  • Passport Size Photographs