The Supreme Court of India on March 4, 2025, expressed dissatisfaction with the functioning of the Real Estate Regulatory Authority (RERA), stating that it has failed to effectively protect homebuyers’ investments and promote the real estate sector as originally intended. The remarks came during a hearing on issues concerning delays and disputes in real estate projects.
Key Issues with RERA’s Implementation
- Delays in Dispute Resolution: The Act was meant to ensure speedy redressal of complaints, but cases often remain unresolved for long periods.
- Domino Effect on the Real Estate Sector: The inefficiency of RERA has worsened financial stress in the industry, affecting homebuyers and developers alike.
- Inadequate Enforcement: Despite stringent regulations, many developers fail to comply with project registration, financial transparency, and escrow norms.
Overview of RERA – A Key Reform in the Real Estate Sector
- Enacted in 2016 by the Parliament, the Real Estate (Regulation and Development) Act aimed to bring transparency and accountability in the housing sector.
- Mandatory Registration: Builders must register projects with state-level RERA authorities before launch.
- Financial Security: Developers must deposit 70% of buyers’ payments into an escrow account to prevent fund diversion.
- Standardization: Carpet area calculation and pricing have been standardized nationwide, ensuring fair pricing for homebuyers.
- Legal Protection: Buyers can appeal against RERA decisions to the Appellate Tribunal.
(Sources: The Hindu & PIB)
