The Real Estate Regulation and Development Act (RERA) of 2016 went into effect on May 1, 2016, putting an end to real estate scams and house buyer insecurity. At the time, the business was in desperate need of a meaningful regulatory system to maintain home buyers’ trust in the real estate market. With early reservations about learning and interpreting the new rules, developers and stakeholders adopted this new guideline for real estate regulations.

Let’s fast-forward now. RERA Act has revolutionised the real estate market and created a strong, trustworthy, and credible real estate ecosystem five years later. RERA acts as a protective shield for real estate investors and homebuyers. The statute mandates builders to provide regular updates on the state of their under-construction projects, protecting investors’ and homebuyers’ rights and raising the concerns of complainants.

INDEX:

1. A Snapshot of the RERA Act

2. An analysis of the registered projects under RERA

3. Complaints settled vs. project registration

4. The current state of data and the path forward

1. A Snapshot of the RERA Act

Various states have established mandated regulatory frameworks for the RERA Authority and the associated appellate tribunal, as indicated in the RERA Act, and have additionally defined state-specific RERA rules since the legislation’s introduction. Except for Nagaland, all 36 states and UTs have notified RERA rules, 31 have established RERAs, and 28 have established Real Estate Appellate Tribunals (REATs). Furthermore, 27 RERAs have implemented their own websites in accordance with the RERA Act.

According to the Ministry of Housing and Urban Affairs, the registered projects are 78,494 and resolved complaints are 88,864 across the country as of April 9, 2022. 

Maharashtra RERA has registered the most projects since its start, accounting for 34,280 projects, or 43.6 percent of all projects registered in the country, followed by Gujarat with 9,822 projects (12.49 percent), and Karnataka with 4,783 projects (6.08 percent ). The fastest-growing states, however, are Andhra Pradesh and Telangana, which have experienced a 1200 percent increase in project registration. It’s possible that the large relative rise of projects registered in states like Andhra Pradesh and Telangana is due to the fact that RERAs did not work well in the early years, and project registration was low.

2. An analysis of the registered projects under RERA

Because RERA collects data on real estate project growth, it’s useful to compare real estate dynamics across Indian states. While real estate markets are significantly influenced by local market conditions, macroeconomic factors such as urbanisation and economic performance have a significant impact on real estate demand.

3. Complaints settled vs. project registration

Except for Uttar Pradesh and Haryana, most states have a healthy balance between the number of projects registered and the number of complaints addressed.

While there are known incidents of massive complaints in areas like Noida (Uttar Pradesh) and Gurgaon (Haryana), as well as significant real estate demand in the Mumbai Metropolitan Region (MMR), this trend is not fully reflected in RERA results because to data gaps. These factors include the number of complaints received vs those resolved, as well as the type of the resolution itself.

4. The current state of data and the path forward

RERA plays a critical role in making the real estate business more transparent and releasing information to the public. However, there are several gaps in the RERA data in MoHUA that make it difficult to assess the legislation’s genuine impact on the real estate market. Because many projects are exempt from registration, RERA-registered projects do not represent the entire real estate sector. Another limitation is the lack of data on RERA bodies’ complaints, as the MoHUA only distributes processed data, not pending data.

Furthermore, the extension of RERA should to rural areas would enable to better understand the varying real estate dynamics in different states.