Understanding RERA in Real Estate: Objectives and Rules

RERA is the Real Estate (Regulation and Development) Act, 2016 — the central law that requires most Indian property projects to be registered with a state regulator before they can be advertised or sold, and that gives homebuyers a legal route to a refund, interest or compensation when a developer misses what was promised.

It received Presidential assent on 25 March 2016. Fifty-nine of its sections were notified on 1 May 2016, and the Act came into full force on 1 May 2017. Every state and union territory now runs its own Real Estate Regulatory Authority under it, with its own rules, fee schedule and portal.

This guide covers what RERA is, the rules and sections that actually get enforced, how project and agent registration works, what it costs state by state, the penalties for getting it wrong, and what all of it means day to day for a developer, a broker or a homebuyer.

One note before we start: this is general information, not legal advice. State rules differ, and the Act has been interpreted differently by different tribunals. Check your state authority or a property lawyer before acting on anything specific.

What Is RERA in Real Estate?

RERA stands for the Real Estate (Regulation and Development) Act, 2016. The regulator each state sets up under it is called the Real Estate Regulatory Authority — which is also abbreviated RERA, so the same four letters are used for both the law and the body that enforces it.

Before 2016, Indian real estate had no sector regulator. A buyer who paid 40% of a flat and then watched the project stall for six years had two options: wait, or fight a civil suit that would outlive the delay. Developers set their own carpet-area definitions, moved money between projects, and advertised approvals they did not have. RERA exists to close those three gaps specifically.

The Act does four things. It makes registration compulsory for most projects and for every agent who sells them. It forces disclosure of plans, approvals, timelines and quarterly progress onto a public website. It ring-fences buyer money so it cannot fund a different project. And it creates an authority and an appellate tribunal that can order refunds, interest and penalties without the buyer going to civil court.

What Does RERA Stand For? (Full Form)

The full form of RERA is the Real Estate (Regulation and Development) Act, 2016. In everyday use, "RERA" also refers to the state Real Estate Regulatory Authority — for example MahaRERA in Maharashtra or UP RERA in Uttar Pradesh. A "RERA number" or "RERA registration number" is the unique ID a registered project or agent is issued, which must appear on every advertisement.

RERA Rules: The Sections That Actually Get Enforced

Most RERA disputes come back to a short list of sections. If you only learn nine things about the Act, learn these.

Section 3 — Mandatory Project Registration

State authorities require registration before a project can be advertised, marketed, booked or sold where the land exceeds 500 square metres or the project has more than eight apartments, inclusive of all phases. The sub-section is drafted as an exemption and the disjunctive wording has been read differently in places, so treat your own state authority’s position as controlling — and note that governments may set lower thresholds than these. Each phase counts as a standalone project and needs its own registration. Ongoing projects that had not received a completion certificate when RERA commenced also had to register.

Section 4(2)(l)(D) — The 70% Separate Account Rule

Seventy per cent of the amounts realised from allottees must be deposited in a separate bank account maintained for that project, to cover the cost of construction and the land cost. The promoter can withdraw only in proportion to the stage of completion, and each withdrawal has to be certified by an engineer, an architect and a chartered accountant. This is the provision that stops money collected for Tower B from being spent on a land parcel in another city.

Section 2(k) — Standardised Carpet Area

Carpet area is defined as the net usable floor area within the walls of an apartment — excluding the external walls, areas under service shafts, the exclusive balcony or verandah, and the exclusive open terrace, but including the internal partition walls. This is why post-RERA pricing is quoted on carpet area rather than the older, elastic "super built-up" number.

Section 11 — Disclosure and Quarterly Updates

The promoter must publish project details on the authority's web page — sanctioned plans, layout, approvals, the proposed completion date, the status of the land title — and keep it current with quarterly updates on the number of apartments booked and the stage of construction. Stale project pages are one of the most common compliance findings.

Section 12 — Liability for Misleading Advertisements

If a buyer makes a payment relying on a false or incorrect statement in an advertisement, prospectus or model apartment, and then wants out, the promoter must refund the full amount with interest. If the buyer stays, they are entitled to compensation. This is the reason RERA registration numbers and authority URLs are now mandatory in creative.

Section 13 — The 10% Advance Cap

A promoter cannot accept more than 10% of the cost of the apartment, plot or building as an advance or application fee without first entering into a written agreement for sale and registering it. The pre-RERA practice of collecting large "booking amounts" against a one-page allotment letter is not permitted.

Section 14(3) — Five-Year Defect Liability

If a structural defect, or a defect in workmanship, quality or provision of services, is brought to the promoter's notice within five years of possession, it must be rectified within 30 days at no cost to the allottee. If it is not, the allottee is entitled to compensation.

Section 18 — Delay, Refund and Interest

This is the section most buyers end up using. If the promoter fails to complete or hand over possession by the date in the agreement, the allottee can either withdraw and receive a full refund with interest and compensation, or stay in the project and receive interest for every month of delay until possession. The interest rate is prescribed in the state rules.

Sections 9 and 10 — Agent Registration and Duties

No agent can facilitate the sale or purchase of a unit in a registered project without their own RERA registration. Registered agents must keep books of account, must not make false representations, and must give buyers access to the same project information the promoter is obliged to publish. This applies squarely to channel partners and sub-brokers, not only to individual agents.

Section 31 — Filing a Complaint

Any aggrieved person can file a complaint with the state authority against a promoter, an allottee or an agent. Appeals go to the Real Estate Appellate Tribunal, and a promoter appealing a monetary order must first deposit at least 30% of the penalty, or the amount payable to the allottee, whichever is higher.

Objectives of RERA

The Act was written to fix four specific failures in the pre-2016 market.

• Hold developers accountable. Registration, disclosure, timelines and escrow are all enforceable, with financial penalties and — for repeat or serious violations — imprisonment attached.
• Promote transparency. Approval status, sanctioned plans, completion timelines and quarterly progress have to be public before a single unit is sold.
• Protect buyers. Standardised carpet area, capped advances, a five-year defect liability and a statutory right to interest on delay shift risk back onto the party that controls the timeline.
• Create a regulator with teeth. Each state authority can adjudicate, order refunds, impose penalties, and revoke a project's registration. An appellate tribunal sits above it, which keeps disputes out of clogged civil courts.

RERA Registration: Criteria, Process and Documents

Which Projects Must Register (RERA Criteria)

• Land above 500 square metres, or more than eight apartments across all phases — the thresholds at which state authorities require registration. Governments may notify lower limits, so confirm locally rather than assuming the central figures.
• Ongoing projects that had not received a completion certificate on the date the state's RERA rules commenced also had to register.
• Each phase is a separate project. A four-tower development launched in stages needs a registration per phase, each with its own completion date.
• Commercial projects are covered too. RERA applies to real estate projects generally, not only residential ones — offices, shops and mixed-use developments meeting the thresholds must register.
• Exemptions: projects below both thresholds, renovation or repair work that does not involve marketing or fresh allotment, and construction for the promoter's own use. Exemption criteria vary slightly by state — verify locally.

Steps for Project Registration

• Confirm eligibility and assemble approvals. Land title, commencement certificate, sanctioned layout and building plans, and the approvals from the local authority.
• File the application on the state portal with project details, the proposed completion date, the phase definition and the promoter's track record for the last five years.
• Submit financial disclosures, including audited statements and the declaration that 70% of realisations will go into a separate account.
• Pay the registration fee, which is set by the state and usually calculated per square metre with a floor and a ceiling.
• Receive the registration number, then display it on every advertisement, brochure, hoarding, website page and sales document — and maintain quarterly updates for the life of the project.

Documents Required

• Layout plans, sanctioned building plans, the proposed facilities and the phase-wise completion schedule.
• Land title documents, encumbrance certificate and copies of all statutory approvals.
• Promoter details, including the track record of projects completed and delayed over the previous five years.
• Audited financial statements and the escrow account declaration.
• The proforma of the allotment letter and agreement for sale the promoter intends to use.

State RERA Authorities and Registration Fees

RERA is a central Act, but it is implemented through state rules. That means the authority, the portal, the fee schedule, the prescribed interest rate on delay and some procedural conditions all change when you cross a state border. If you sell across markets, this is the part that costs teams the most time.

Registration Fees by State (Indicative)

Fees are typically charged per square metre of land or FSI area, with separate slabs for residential and commercial projects and a cap at the top end. Indicative published figures:

• Uttar Pradesh — around Rs 10 per sq m for projects up to 1,000 sq m; roughly Rs 500 per 100 sq m beyond that, subject to a ceiling.
• Delhi — approximately Rs 10,000 for residential and Rs 50,000 for commercial projects at the lower slabs.
• Maharashtra — approximately Rs 10,600 for residential and Rs 1,00,600 for commercial, inclusive of processing charges.
• Most other states price per square metre with a floor and a cap, and charge a separate, much smaller fee for agent registration, usually renewable.

Treat these as a planning signal, not a quote. Fee schedules are revised, and several states levy additional processing or extension charges. Always confirm on the state portal before you budget.

Where to Check Your State Authority

• Maharashtra — MahaRERA, the most active authority by order volume and the source of much of the sector's case law.
• Uttar Pradesh — UP RERA, with the largest volume of registered projects in North India.
• Haryana — HRERA, which operates separate benches for Gurugram and Panchkula.
• Karnataka — K-RERA, covering the Bengaluru market.
• Gujarat — GujRERA, one of the earliest authorities to move fully online.
• West Bengal — WBRERA. West Bengal originally ran a parallel state law, HIRA, which the Supreme Court struck down in May 2021 as repugnant to the central Act; the state established WBRERA afterwards.
• Telangana, Rajasthan, Tamil Nadu, Madhya Pradesh and the rest each run their own authority and portal, with rules notified separately.

The practical rule for a multi-city developer or broker: verify every project number on the authority portal of the state the project sits in, not on an aggregator, and re-check before each campaign flight.

Five Features That Changed How Projects Are Sold

• Security — the 70% escrow. Buyer money is tied to the project it was collected for, and released against certified construction progress.
• Transparency — public disclosure. Layouts, approvals, timelines and quarterly booking and construction status live on a public page a buyer can check before paying anything.
• Fairness — one carpet-area definition. Pricing is quoted on a legally defined number, so two projects in the same corridor can finally be compared like for like.
• Quality — five-year defect liability. Structural and workmanship defects reported within five years of possession are the promoter's cost to fix.
• Authorisation — mandatory registration. A project that cannot show a registration number cannot legally be marketed, which removes a whole category of speculative pre-launch selling.

What RERA Means for Agents, Brokers and Channel Partners

The agent obligations under Sections 9 and 10 are the most frequently missed part of the Act, because they sit outside the developer's compliance checklist and land on a distributed network of channel partners and sub-brokers.

• Register before you sell. An unregistered agent facilitating a sale in a registered project is in default, and the penalty accrues per day.
• Do not market an unregistered project. The registration number must exist and be current before any listing, hoarding, portal ad or WhatsApp forward goes out.
• Reproduce the project information accurately. Section 12 liability attaches to statements a buyer relied on, and "the developer sent me that creative" is not a defence for the agent who forwarded it.
• Keep books and records. Registered agents are required to maintain books of account and produce them if the authority asks.

For a developer running an empanelled partner network, this is an operational problem rather than a legal one: you need to know which partner sourced which lead, what creative they used, and whether their registration is live. That is far easier when partner activity runs through a single system rather than a spreadsheet and a WhatsApp group — the same argument as preventing lead leakage across a broker network.

RERA-Compliant Marketing: What Has to Appear in Every Ad

Section 11 and Section 12 together set a floor for what marketing can say and must carry. In practice, campaigns get pulled for the same handful of reasons.

• The registration number and the authority website URL must appear on every advertisement — print, hoarding, portal listing, landing page, brochure, social creative and video end card. Small type at the foot of a hoarding still counts; absent type does not.
• No claims you cannot evidence. Amenities that are proposed, approvals that are applied for, and possession dates that are aspirational have to be described as exactly that. Superlatives about returns are the highest-risk copy on any page.
• Carpet-area pricing. Quote on carpet area. Mixing a super built-up rate into the headline and a carpet-area figure into the fine print is the pattern that draws complaints.
• Consistency across channels. The possession date on the portal listing, the microsite and the authority page should be the same date. Divergence is what a complaint under Section 12 is built on.

This constrains creative more than most teams expect, which is why the strongest performers lean on differentiation that does not depend on unverifiable claims — see the approach in our guides to real estate taglines that work and ad creative examples.

Penalties Under the RERA Act

The penalty structure scales with who defaulted and how badly.

• Promoter, non-registration (Section 59) — up to 10% of the estimated project cost. If the default continues after an authority order, imprisonment of up to three years, or a further fine of up to 10%, or both.
• Promoter, false information or contravention of Section 4 (Section 60) — up to 5% of the estimated project cost.
• Promoter, other contraventions (Section 61) — up to 5% of the estimated project cost.
• Agent, non-registration or contravention (Section 62) — Rs 10,000 per day of continued default, up to 5% of the cost of the plot, apartment or building.
• Failure to comply with an authority order (Section 63) — a daily penalty that may cumulatively extend to 5% of the estimated cost.
• Failure to comply with a tribunal order (Section 64) — imprisonment of up to three years, or a fine of up to 10% of the estimated cost, or both.
• Allottee non-compliance (Sections 67 and 68) — allottees are not exempt; failure to comply with authority or tribunal orders carries its own penalties and, for tribunal orders, up to one year's imprisonment.

Revocation of registration (Section 7) is the outcome developers underestimate. When an authority revokes a project's registration, the promoter is barred from accessing the escrow account, is debarred from the authority's website, and the authority may take steps to have the project completed — including handing it to the allottees' association or another developer.

How RERA Works for Each Stakeholder

For Homebuyers

A verifiable registration number before payment, pricing on a defined carpet area, an advance capped at 10% until an agreement is registered, interest for every month of delay, five years of defect cover, and a complaints route that does not require a civil suit.

For Developers

A level field. Competitors can no longer undercut on a fictional area definition or fund a launch with another project's collections. Registration and disclosure are also a sales asset — a buyer comparing two towers will take the one whose authority page is current. The cost is administrative: quarterly updates, certified withdrawals, and hard completion dates you have to hit.

For Agents and Channel Partners

Registration is a barrier that removes casual competition, and a registered agent selling a registered project is a materially easier trust conversation. The obligation is to keep records and to represent the project exactly as the authority page does.

For Investors

Escrow reduces diversion risk, disclosure makes delay visible earlier, and Section 18 converts a stalled project from an unrecoverable position into a claim for refund with interest.

Staying Compliant Without Adding Headcount

Most RERA breaches are not decisions — they are drift. A registration number goes stale, a quarterly update is missed, a partner keeps circulating an old creative with last year's possession date, a payment schedule quietly crosses the 10% advance line before the agreement is registered.

The controls that prevent that are unglamorous: one source of truth for project data, hold-and-block logic on inventory so units cannot be double-committed, source tagging so you know which partner and which campaign produced every booking, and payment milestones that are enforced by the system rather than remembered by a person. Sell.do handles this side — unit and tower inventory with hold-block logic, source-to-booking attribution, and post-sales collections and possession tracking in the same platform your presales team already works in.

If you are evaluating what that looks like end to end, our guide to real estate CRM for Indian developers and the lead management playbook cover the operational layer this sits on.

RERA FAQs

What is the full form of RERA?

RERA stands for the Real Estate (Regulation and Development) Act, 2016. The same abbreviation is used for the Real Estate Regulatory Authority that each state sets up under the Act.

How does RERA work?

A developer registers each project or phase with the state authority before marketing it, discloses plans, approvals and a completion date publicly, keeps 70% of buyer money in a separate project account, and updates progress quarterly. If the developer misses the committed date or misrepresents the project, the buyer files a complaint with the authority and can claim a refund with interest, or interest for every month of delay.

What are the RERA criteria for registration?

State authorities require registration when the project land exceeds 500 square metres or the project has more than eight apartments, counted across all phases, and some governments have notified lower thresholds. Ongoing projects without a completion certificate at commencement also had to register. Each phase requires its own registration.

Is RERA applicable to commercial projects?

Yes. The Act applies to real estate projects generally, so commercial and mixed-use developments that cross the 500 square metre or eight-unit thresholds must register in the same way residential projects do.

What is the difference between a RERA and a non-RERA property?

A RERA-registered project has a verifiable registration number, published plans and approvals, a committed completion date, escrowed buyer funds and a statutory complaints route. A non-registered project that meets the thresholds is being marketed unlawfully, and the buyer has none of those protections — which is why the registration number should be checked on the state portal before any payment.

Can RERA actually enforce its orders?

Yes. State authorities can order refunds, interest and compensation, impose penalties calculated as a percentage of project cost, and revoke a project's registration, which cuts off the promoter's access to the escrow account. Non-compliance with a tribunal order can carry imprisonment of up to three years. Appeals go to the Real Estate Appellate Tribunal, and a promoter must deposit at least 30% of the amount before appealing.

Do real estate agents need to register under RERA?

Yes. Under Section 9, an agent must be registered before facilitating a sale or purchase in a registered project. Operating without registration attracts a penalty of Rs 10,000 per day of default, up to 5% of the cost of the unit.

What can a buyer claim if a project is delayed?

Under Section 18, the buyer can either withdraw from the project and claim a full refund with interest and compensation, or remain in the project and claim interest for every month of delay until possession is handed over. The applicable interest rate is prescribed in the state rules.

The Bottom Line

RERA turned Indian real estate from a market where the buyer carried the timeline risk into one where the developer does. For buyers, the practical takeaway is short: check the registration number on the state authority portal, price on carpet area, and do not pay more than 10% before a registered agreement for sale.

For developers and channel partners, compliance is no longer a legal department problem — it is an operations problem that shows up in inventory, marketing creative, partner management and collections at the same time. Teams that treat it that way spend less on remediation and close faster, because a project with a current authority page and a clean registration number is simply easier to sell.

Related reading

• Real Estate CRM for Developers in India: The 2026 Guide
• Channel Partners in Real Estate: Role, Benefits and How the Model Works
• Real Estate Post-Sales Management: Bookings to Possession

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