What is RERA?
The Real Estate (Regulation and Development) Act, 2016 (RERA) was enacted by the Parliament of India to protect homebuyers from project delays, false promises, and fraudulent practices by real estate developers.
Key Buyer Protections Under RERA
1. Mandatory 70% Escrow Deposit
Developers must deposit 70% of all collected funds from buyers into a dedicated bank escrow account. These funds can strictly be drawn only for construction costs and land purchase, preventing diversion of funds to other projects.
2. Sale Based on Carpet Area
RERA mandates that properties and plots must be sold based on actual Carpet Area / Clear Plot Area rather than misleading super built-up terms.
3. Compensation for Project Delays
If a developer fails to hand over possession on the committed date mentioned in the RERA agreement, they must pay interest equivalent to SBI MCLR + 2% for every month of delay to the buyer.
4. 5-Year Workmanship Warranty
Developers are legally bound to rectify any structural defects or poor workmanship reported by buyers within 5 years of possession without any extra charges.
How to Verify a Project on RERA Portal
- Visit your state's official RERA portal (e.g., rera.rajasthan.gov.in for Rajasthan).
- Click on "Search Registered Projects".
- Enter the Developer Name or RERA Registration Number.
- Inspect approved layout plans, land ownership documents, litigation details, and quarterly construction progress updates.
