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What is the RERA Act 2016? Everything You Need to Know About the RERA Act!

The real estate industry has always been the most interesting and profitable industry of all time. After all, it’s about land properties. But the history of land investment has countless cases that cost buyer’s money without any proper return. But something happened in 2016 when the Indian government passed a law named RERA Act, 2016. The law critically condemns misuse of buyer’s trust and investment and imposes penalties to the fault doers. 

Understanding the RERA Act will give you a sound understanding of real estate investment rights and open the door for the judiciary to take care of your assets. 

This article shares in-depth understanding of RERA Act, 2016 and how it can help you. 

Table of Contents:

What is RERA Act 2016?

The RERA Act was passed in 2016 to empower real estate investment & give the buyers power to get their rights as promised by the developers. The act was needed as there are countless cases where developers have cheated the buyers. 

The RERA Act was a solid move to establish a transparent, efficient, and trusted investment sector for the people of India. The motive was to keep consumer’s interest alive in the real estate market. The government created a regulatory body in each state & union territory of India to look over property transactions and to make sure that homebuyers and developers are on the same playing level where developers are adhering to deadlines and must deliver what they promised. RERA also created an escrow account to keep the buyer’s money safe.

Why is RERA Important? 

RERA Act, 2016 implies necessary accountability on the developers and empowers the trust of common people in the real estate sector. The law also opens a door for the common public to get more transparent deals as well as helps the government to keep a sharp eye on each transaction in different zones. 

The government has created groups of experts from different fields. They are responsible for enforcing the act into the state’s jurisdiction. Also, they are responsible for project registration, information disclosure, and adherence to the deadlines & promises. These authorities deal with consumer complaints who want juridical justice against quality issues, delays, and violations of the RERA laws. 

These authorities also hold the power to penalise the developers for their misconduct in operations. Penalties and compulsory registration are powerful tools for revitalising the interests of people in real estate. 

RERA’s Salient Features

  • Each & every state must have a RERA authority to monitor projects as suggested in the concerned form. 
  • Each project must be registered with RERA. 
  • RERA establishes a fast-track mechanism to solve disputes at the earliest. 
  • 2/3rd of the project allottees must give written consent to RERA for gaining the Transferring rights & liabilities to a third party. 
  • The promoter is obliged to give compensation to the buyer if there are any financial losses for the buyer due to third parties asserting claims on under-construction projects. 
  • If there’s any fault from the promoter or buyer side, they also must pay equal interest. 
  • Anyone can complain if they see a promoter and developer or buyer violating the RERA law. 
  • The penalty against the violation of RERA laws can go up to 5% of the total cost of the property. 
  • If not satisfied with the RERA judgement, a person can appeal to the Appellate Tribunal. 
  • If found guilty and not compiling the necessary steps, the Appellate Tribunal can give a penalty of 10% of the evaluated cost or imprisonment of 3 years. 

Types of RERA Registration: 

The Indian government has issued three kinds of RERA registration as follows: 

Project Registration Promoter Registration Real Estate Agent Registration
All projects must register to RERA. This is compulsory to sell their units to buyers. This falls under the promoter’s job to register any property with proper documentation and the rightful amount of fees. All promoters must register themselves as promoters under RERA. This step makes them accountable for their promoted properties. A promoter will show his data with his project details to RERA. Real Estate Agents as well must register themselves with RERA for transparency and as an authority of their respective properties or agency.

Documents Needed for RERA Registration:

For Promoters: For Agents:
PAN Card PAN Card
Available Parking Slots Permanent Address Proof
Legal Title Deeds Photograph
Encumbrance Certificate Details of Real Estate Agent Enterprise
Commencement Certificate Registration of the Enterprise
Section Plan, Layout Plan, and Project Plan
Development Plan
Previous Project Experience

Benefits of Registering into RERA

1. Right to Information: 

RERA Act empowers buyers with its right-to-information feature to identify all the details of a project. This is extremely helpful as buyers get to know all information about their investment project such as layout, execution plan, stage-wise completion status, etc. 

2. Necessary Clearance: 

All builders and developers must get RERA registration certification before starting a project. The property documents include NOC, completion certification, and occupancy certificate as well. 

3. Registration of Real Estate Agents: 

RERA Act makes it compulsory for all real estate agents to register with RERA. All deals done by real estate agents must be done under their registration number. Failing to do so will be liable to penalties or imprisonment. 

4. Balanced Agreement & Transparency: 

THE RERA makes sure that the buyer and developers have a balanced agreement. Earlier the developers used to have an upper hand on all deals. This also keeps things transparent on both sides. 

5. Ensures Construction Quality: 

RERA stands for the construction quality of any project. Under this, a developer is responsible for any kind of damage in the construction up to 5 years. They have a 30-day limit to act upon any complaints regarding construction. Failing to do so makes them liable for penalties. 

6. On-Time Delivery of Projects: 

RERA secures the on-time delivery of the projects to buyers. Failing to do so will add 2% interest over the State Bank of India’s lending rate to the home buyers or imprisonment for up to 3 years. 

7. Sale Based on Carpet Area: 

The RERA act has made carpet areas the standard units of property sale and the super built-up model is banned. Moreover, a developer can’t change the layout of the project without the consent of 2/3 of the total buyers. 

If you want to know the penalties under RERA across different states, then check out this link for detailed information.

State-wise RERA Registration

State / UT Registration Fees (INR)
Maharashtra 10,000
Delhi 25,000
Karnataka 10,000
Tamil Nadu 10,000
Telangana 10,000
Gujarat 5000
Uttar Pradesh 25,000
Haryana 25,000
Rajasthan 10,000
West Bengal 10,000
Kerala 1,000
Punjab 5,000
Madhya Pradesh 5,000
Odisha 5,000
Chhattisgarh 5,000
Bihar 5,000
Jharkhand 5,000
Himachal Pradesh 1,000
Uttarakhand 10,000
Goa 5,000
Chandigarh 5,000
Andhra Pradesh 10,000
Puducherry 5,000
Tripura 5,000
Andaman & Nicobar 5,000
Dadra & Nagar Haveli 5,000
Daman & Diu 5,000
Lakshadweep 1,000
Meghalaya 5,000
Mizoram 5,000
Nagaland 5,000
Sikkim 5,000
Arunachal Pradesh 5,000
Manipur 5,000
Ladakh 5,000

Challenges of RERA

  • The most important and necessary challenge is to overcome the non-uniformity of RERA laws across states. The varying interpretations of the law create confusion and leave loopholes for favours. 
  • Varying degree of support from the corporations challenges RERA authorities to register projects and disclose project details and deadlines. 
  • Many buyers are still not aware of RERA authorities, or their property rights. 
  • Effectively penalising the developers is still a challenge to authorities which sometimes becomes a loophole for developers. 
  • Some laws in the RERA act depend on interpretation. This causes delay in the due progress. 
  • Financial burden on developers as per the ERA act has increased cost and potential impact on project viability. 
  • The authorities are focusing more on the new projects and leaving space for delays & misuse of buyer’s money. 
  • Some authorities may face challenges of incapacity, resources, and autonomy in dealing with state-level consumer grievances. 
  • The successful implementation of RERA requires technology for registration, documentation, and complaints. 
  • The penalties must be strictly imposed for violations. However, several incidents have put a question mark on RERA judgements as well. 

Also Read: Will RERA empower the Real Estate builders?

Step-by-Step RERA Registration

RERA authority rules over all the states & union territories in India. The application process varies from project to project. More to it, the three different application types require different documents as well. However, in general, you can follow the following given registration process as a roadmap. 

Step 1: Create an Account

Register your project with RERA through their official website. Start by sharing basic information such as name, email, mobile number, and address. 

Step 2: Application from Completion: 

Complete the whole application form by sharing all the necessary information about the projects such as location, dimensions, unit count, anticipated completion date, etc. 

Step 3: Document Submission: 

The next step is submitting all your documents to the RERA website. These documents will include a Title Deed, Building Plan, and Land-Use certificate. More to it, the submission will also require the details of the architect, engineer, and contractor involved in the project. 

Step 4: Pay the Required Fees: 

Once you upload all the required documents, you must pay the required fees in full. Please note that registration fees might differ throughout the states so applicants must get details from respective RERA websites. 

Step 5: Receipt of Registration Certificate: 

After the successful payment, your application will be reviewed. You, as an applicant will get a registration certificate when everything aligns positively with your requirements. 


RERA Act, 2016 has been a boon to the real estate industry. This has effectively lowered the misuse of buyers’ money and has made all construction deals transparent to the public and government. 

In this article, we have discussed how the RERA act has imposed compulsory limitations on the builders & developers as well as empowered the common public of the country. The act has some challenges but they are hopefully taken care of. 

If you want to invest in real estate properties in India, then you should definitely know about RERA and how to choose the best real estate company in India.

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