How RERA Act (Real Estate (Regulation And Development)Act, 2016) Will Help HomeBuyers


The real estate sector has been growing significantly in recent years; however it has been largely unregulated, with absence of professionalism and standardization and lack of adequate consumer protection. RERA Act (Real Estate (Regulation and Development) Act), 2016 has ushered in effective consumer protection, uniformity and standardization of business practices and transactions in the real estate sector.

Benefits for Buyers under the RERA Act: Protection of Buyers:

1. Standard Carpet Area:

Prior to RERA Act coming in to force every builder had a different formula for calculating the carpet area of an apartment, however after RERA Act came in to force the carpet area has been defined as follows:

“the net usable floor area of an apartment, excluding the area covered by the external walls, areas under services shafts, exclusive balcony or verandah area and exclusive open terrace area, but includes the area covered by the internal partition walls of the apartment.”

Selling of property based on super built up area has been prohibited and can only be sold based on the carpet area. Additionally, developers will also require consent of two-thirds of the buyers in a project before changing project & design or any other structure.

2. Establishment of Authority for grievance redressal under RERA Act:

RERA Act provides for the establishment of the Real Estate Regulatory Authority for regulation and promotion of real estate sector and to ensure sale of plot, apartment or building, in an efficient and transparent manner and to protect the interest of consumers in
real estate sector and establish the Real Estate Appellate Tribunal to hear appeals from the decisions, directions or orders of the Authority.

Also Read: Legal Remedies Against Builder In India

3. Mandatory Registration of Real Estate Projects:

The Real Estate Act makes it mandatory for all commercial and residential real estate projects where the land is over 500 square metres, 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. For failure to register, a penalty of up to 10 percent of the project cost or three years imprisonment may be imposed.

4. Builders will need all clearances before selling:RERA Act

Earlier, builders often sold projects that did not have all clearances, causing many problems for the buyers. Under RERA, builders and agents will have to register themselves with the regulator, disclose every detail about the project and will be able to sell projects only after the necessary clearances have been attained.

5. Builders won’t be able to use your money for some other project:

Under RERA, the developer will be required to transfer 70% of the money received from
buyers to an escrow account. Post which, the money will be withdrawn as per the stage of the construction, that will be approved by engineers and chartered accountants of builders.

6. Builders will be held responsible for any defect in the construction under RERA Act:

Under RERA, any structural defect that takes place to the property for up to five years
from the date of handing over possession will have to be repaired by the developer. It shall be the duty of the promoter to rectify such defects within 30 days without further charge.

7. No more delays in the project:

Under section 18 of the RERA Act, buyer is entitled to seek refund of the full amount paid along with interest/possession of the apartment in question along with compensation if the project is not complete and the promoter fails to give possession.


Overall, the execution of RERA has been a boon for homebuyers. Now homebuyers are also confident of faster and fair resolutions under the law.

To know more about RERA Act & your rights under the Act write to us at

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.