RERA Compliance
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Table of Content
- RERA Compliance
- Key Areas of RERA Compliance
- Documents Required for RERA Compliance
- RERA Compliance for Builders and Developers
- Benefits of RERA Compliance
RERA Compliance
RERA (Real Estate (Regulation and Development) Act, 2016) is an Indian law aimed at promoting transparency, accountability, and efficiency in the real estate sector. It is applicable to both residential and commercial real estate transactions. RERA compliance ensures that developers, real estate agents, and builders adhere to the prescribed rules and regulations set by RERA authorities.
- Builders & Developers must register their projects with RERA before advertising, marketing, or selling properties.
- Real Estate Agents must also register with RERA to conduct any property-related transactions.
- Developers must register a real estate project with RERA, providing details like project plan, land title, completion deadlines, and the cost of the project.
- If there is a delay or non-compliance with timelines, developers face penalties or cancellation of project registration.
o Developers must provide clear and accurate details about the project, including:
- Carpet area of apartments.
- Timeline for delivery.
- Building plans and approvals.
- Availability of funds and work status.
- Title of the land/property.
- Real estate advertisements must clearly mention the RERA registration number and must not mislead customers regarding project details.
- No false claims about project timelines, amenities, or quality of construction can be made.
- Developers are required to guarantee that the property will be free from defects for a minimum of 5 years from possession.
- If a defect arises, the developer must repair it or refund the cost.
- Developers must adhere to the promised completion and possession dates. If there is any delay, they are liable to compensate homebuyers for the delay as per RERA regulations.
- Builders must ensure that the land title is clear and must provide legal proof of the land being free of encumbrances.
Documents Required for RERA Compliance
- Project name, developer’s name, and location.
- Total land area and approval documents.
- Carpet area of individual units.
- Approvals and sanctions from municipal authorities.
- Title deed of the land.
- Registration of the land under the correct ownership.
- Agreement for Sale of land, if applicable.
- Detailed layout and architectural drawings.
- Building plan approval from the local authorities.
RERA Compliance for Builders and Developers
- Timely Registration: Ensure your project is registered before advertising or selling.
- Transparency: Make sure all information about the project is correct and disclosed on the RERA portal.
- Maintenance of Funds: Developers must keep the funds raised for the project in a separate bank account, dedicated solely for that project.
- Defects Liability: Ensure that the project is free from any defects for 5 years post-possession.
- Adherence to Project Schedule: Meet deadlines as promised, or face penalties and compensation to buyers.
Benefits of RERA Compliance
- Increased Transparency: Developers must disclose accurate project details, ensuring clear information for buyers.
- Consumer Protection: Timely possession, defect liability (5 years), and clear agreements safeguard buyers’ interests.
- Developer Accountability: Developers are required to register projects, maintain financial discipline, and adhere to project specifications.
- Dispute Resolution: Quick and transparent mechanisms for resolving issues between developers and buyers.
- Boost to Investment: RERA increases investor trust, attracting both local and foreign investments in the real estate sector.
- Standardized Practices: Uniform processes for transactions, regulated agents, and consistent practices across the industry.
- Financial Discipline: Developers must allocate project funds separately, ensuring proper use of funds and timely completion.
- Professional Ethics: Real estate agents must register and follow ethical guidelines, ensuring professionalism in the sector.
FAQs for RERA Compliance
RERA stands for the Real Estate (Regulation and Development) Act, 2016. It aims to promote transparency, accountability, and efficiency in the real estate sector, protecting the interests of homebuyers and promoting fair practices.
Developers, builders, and real estate agents must comply with RERA. Developers must register projects, and agents must be registered to carry out any real estate transactions.
Yes, RERA applies to both residential and commercial real estate projects that are more than 500 sq.m in area or have more than 8 units.
Transparency, consumer protection, timely project delivery, and accountability are the major benefits for both buyers and developers.
Developers face penalties, including fines of up to 5% of the project cost or even imprisonment for non-compliance or false advertising.
Visit the official RERA portal of the state or region where the project is located, and search using the RERA registration number.
It typically takes 30 to 60 days to register a project with RERA, depending on the state.
Developers are legally bound to deliver possession on time. If delayed, they must compensate the buyer for the delay as per RERA.
Developers found guilty of false advertising may be fined up to 10% of the project cost or face legal consequences.
Yes, RERA applies to ongoing projects as well. Developers must register these projects with RERA to ensure compliance.
Related Business Registrations
In addition to registration or incorporation, a business may require other registrations depending on the business activity undertaken. Talk to an Advisor to find out registrations your business may require post registration.
