Real Estate Regulatory Authority

What is RERA Act?

The Real Estate Regulatory Authority or the RERA Act was established under the Act of 2016 with the main aim to regulate the real estate sector and address the issues faced by homebuyers. The goal is to create fair and equitable transactions between the seller and the buyer of properties in the primary market. The process is made simpler by bringing better accountability and transparency. The Act makes it mandatory for each state and union territory to frame its rules and regulations in this sector. The Act works at a large in protecting the interest of the consumers in the real estate industry. RERA tackles the most crucial part which is the Real Estate Agents. Under the Act, the Central and State government are required to notify their own rules based on model rules framed under the Central Act. The objectives of the Act are:

  • To maintain transparency and interest of the general public.
  • To maintain a correct flow of information between home buyers and sellers.
  • To standardize Pan-India and bring professionalism.
  • To enhance the reliability of the sector and increase confidence.
  • To reduce the chances of fraud.
  • To impose more responsibility on the builders as well as the investors.

Features of RERA

The Real Estate (Regulation and Development) Act of 2016 provides 84 sections within the period of six months from its commencement. The State government sets rules to carry with the association of the HUPA (Housing & Urban Poverty Alleviation) Ministry. The Act provides a minimum of 70% of the buyers’ and investors’ money to be kept in a separate account. The developers cannot ask for more than 10 per cent as an advance payment before the sale agreement. The Act provides fairness and transparency which does not allow the builders to make changes to the plans without the consent of the buyers. The builder must rectify any issue related to quality which is faced by the buyers within 5 years of purchase the issue is rectified within 30 days of the complaint. Any regulator cannot advertise, build, invest, sell, or book a plot without registering with the regulator. The features of the act are as follows:

  • The establishment of Authority was in every Indian state to monitor. It also adjudicates and arbitrates any disputes concerning real estate projects in the concerned state.
  • All real estate projects must be registered with Act so that the authority will have jurisdiction over the projects. The registration of a particular project can be rejected by the authority if guidelines have not been adhered to.
  • If a promoter wishes to transfer or assign a majority of your rights and liabilities in a real estate project to a third party then, written consent from two-thirds of the allottees will be needed in addition to the written approval of RERA.
  • In case there is any default from the side of the buyer or promoter then, both will be liable to pay an equal rate of interest.
  • If the promoter causes any losses to the buyer due to other people laying claim to property (defective title of land) which is under construction or has been constructed, the promoter will have to compensate the buyer. There is no limitation provided by any law currently concerning the compensation amount.
  • There is a penalty to be paid for the imprisonment of 3 years or a fine of 10 % of the cost of the project if the Appellate Tribunal order is not complied with.


The developer or promoter is charged a penalty based on the offence. Following are the penalties applicable:

  • Agents are charged Rs. 10,000 per day in case they are found conducting construction and sales during the registration process.
  • Promoters have to pay 10% of the project estimated cost if they do not register under the Act.
  • If found guilty of giving false information related then they are charged 5% of the cost.
  • The violation of laws leads to imprisonment for 3 years or costs them 10% of the cost of the project.
  • Non-compliance with the Appellate Tribunal will result in 1 year of imprisonment or 10% of the project cost.
  • If there is any breach or fraud or misrepresentation for registration is obtained then section 9 (7) of the Act leads to the cancellation of registration of the agent.
  • If there is a violation of an order of the Appellate Tribunal then section 66 leads to jail for up to one year or a fine of up to 10% of the unit sold.
  • If there is a violation of sections 9 and 10 of the Act then a fine of Rs. 10,000 per day during which the default continues extending to 5 per cent of the unit sold as prescribed under section 62 of the RERA Act.
  • If there is a violation of orders of RERA authorities then section 65 penalises with a fine of up to 5 per cent of the unit sold.
  • For promoters, if there is non-registration, false information or violation of laws then it leads to 10%, 5% and up to three years of imprisonment of the estimated cost of the property respectively.
  • For buyers, offences such as non-compliance with the RERA rules or non-compliance with the Appellate Tribunal result in a daily penalty of up to 5% or imprisonment of up to five years or 10% of the approximate cost of the project.


The authority was bought into action to address the concerns of brokers, stakeholders, homebuyers and builders to implement the reforms according to the rules and guidelines. The RERA committees have been set up across India to promote uniformity and transparency in the real estate industry. The Act mandates all commercial and residential real estate projects larger than 500 sqm or eight apartments are to be registered in the respective state regulatory authority. The authority tries to make the process to be simpler and effortless by bringing regulations and rules to be followed. They try to maintain a stable relationship between the sellers and buyers to ensure accountability and transparency.






Aishwarya Says:

I have always been against Glorifying Over Work and therefore, in the year 2021, I have decided to launch this campaign “Balancing Life”and talk about this wrong practice, that we have been following since last few years. I will be talking to and interviewing around 1 lakh people in the coming 2021 and publish their interview regarding their opinion on glamourising Over Work.


Do follow me on FacebookTwitter  Youtube and Instagram.

The copyright of this Article belongs exclusively to Ms. Aishwarya Sandeep. Reproduction of the same, without permission will amount to Copyright Infringement. Appropriate Legal Action under the Indian Laws will be taken.

If you would also like to contribute to my website, then do share your articles or poems at

In the year 2021, we wrote about 1000 Inspirational Women In India, in the year 2022, we would be featuring 5000 Start Up Stories.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Create a website or blog at

Up ↑

%d bloggers like this: