Why RERA is Required in Real Estate

The real estate sector has long been plagued by delays, fraud, and lack of transparency, leaving homebuyers vulnerable to financial losses. To address these issues, the Real Estate (Regulation and Development) Act (RERA) was introduced in 2016. But why is RERA required in real estate? The primary goal is to protect homebuyers, ensure fair practices, and bring accountability to developers. Additionally, why is RERA registration important? Because it mandates that all real estate projects must be registered under RERA, ensuring legal compliance and safeguarding buyers' investments.

Why Was RERA Introduced? Key Reasons

1. Protection for Homebuyers

Before RERA, many buyers faced issues like project delays, false promises, and even outright scams. RERA ensures that developers cannot launch projects without proper approvals, preventing fraudulent practices.

2. Transparency in Real Estate Transactions

One of the biggest concerns in real estate was hidden costs and unclear terms. RERA makes it mandatory for developers to disclose all project details, including approvals, layout plans, and timelines, on the official RERA website.

3. Prevention of Project Delays

Many buyers suffered due to indefinite project delays. Under RERA, developers must complete projects on time or face penalties. If delayed, they must pay interest to buyers, ensuring accountability.

4. Fair Contract Terms

Earlier, builder-buyer agreements were often one-sided, favoring developers. RERA standardizes contracts, ensuring fair terms for both parties and reducing exploitation.

5. Escrow Account Mandate

To prevent fund diversion, RERA requires developers to deposit 70% of project funds in a separate escrow account. This ensures that money is only used for construction, reducing the risk of abandoned projects.

Why is RERA Registration Important?

1. Legal Security for Buyers

Only RERA-registered projects can be legally sold. Buying in an unregistered project means no legal protection, making RERA registration crucial for safe investments.

2. Ensures Credibility of Developers

RERA registration acts as a credibility check—only serious developers with proper approvals can register. This filters out fly-by-night operators.

3. Easy Access to Project Details

RERA mandates that all project details, including approvals, construction status, and developer track record, be publicly available. Buyers can verify everything before investing.

4. Reduces Litigation Risks

With RERA in place, disputes can be resolved quickly through dedicated tribunals, avoiding lengthy court battles.

5. Boosts Investor Confidence

Since RERA ensures transparency and accountability, more investors are willing to enter the real estate market, boosting overall sector growth.

Conclusion

Why is RERA required in real estate? Because it brings much-needed regulation, transparency, and buyer protection to an otherwise risky market. Why is RERA registration important? Because it ensures that projects are legally compliant, financially secure, and developer-accountable. For homebuyers, investing in a RERA-registered property is the safest way to avoid fraud and delays. Always check RERA registration before purchasing any real estate to protect your hard-earned money.

By understanding RERA's role in real estate, buyers can make informed decisions and invest with confidence. Whether you're buying a home or investing in property, RERA registration is a must for a secure transaction.