What Is RERA And How Does It Work

Manish booked his dream home, hoping to move in within two years. But deadlines kept shifting, and the builder stopped responding. Like thousands of others, Ravi felt helpless. To protect buyers like him, the government launched RERA in 2016. Do you want to know what RERA is and how it works, then stay tuned till the end.

What is RERA?

RERA, or the Real Estate (Regulation and Development) Act, was introduced by the Government of India in 2016 with the primary goal of bringing transparency, accountability, and discipline to the real estate sector. Before RERA, many homebuyers faced issues such as project delays, hidden charges, and false promises made by developers. RERA was implemented to protect the interests of these buyers and to promote fair practices in the industry.

Under RERA, it is mandatory for builders to register their real estate projects with the state RERA authority before advertising or selling. They must disclose important project details like land status, approvals, completion timeline, and more. This ensures that buyers get full information and clarity before investing. One of the biggest advantages of RERA is that it holds developers accountable for timely project delivery. In case of delays, buyers are entitled to compensation.

How does it work?

1. Mandatory Registration

All real estate projects (above 500 sq. m.) must be registered with the respective state's RERA authority before advertisement or sale.

Agents/brokers involved in real estate transactions must also register with RERA.

2. Project Disclosure

Builders must upload detailed project information on the RERA portal:

Project layout, plans, approvals, land title

Timeline for project completion

Details of promoters, contractors, and agents

Buyers can now verify project authenticity before investing.

3. Use of Funds

Developers must deposit 70% of the project funds collected from buyers into a separate bank account.

4. Timely Delivery

Developers must deliver projects as per committed timelines.

If delayed, buyers are eligible for interest compensation and even refunds if needed.

5. Defect Liability

Builders are liable to repair structural defects or quality issues within 5 years of possession—at no extra cost to the buyer.

6. Grievance Redressal

Buyers can file complaints against developers, agents, or even other stakeholders via the RERA Appellate Tribunal.

RERA ensures fast-tracked resolution—usually within 60 days.

 7. Penalties for Non-Compliance

Heavy penalties or even jail time for:

• Selling without registration

• Misleading advertisements

• Delay in possession

• Not honoring agreements

Conclusion 

RERA is a law that protects homebuyers and brings fairness to the real estate sector. It ensures that builders follow rules, complete projects on time, and give all the correct information before selling. It also makes sure that the money collected from buyers is used properly for the same project. If there is a delay or any problem after possession, buyers have the right to get help or compensation. RERA has made the home-buying process more transparent, safe, and trustworthy for everyone.