What is RERA: Meaning, benefits, and registration explained

The Real Estate Act, commonly known as RERA (Regulation & Development), plays a crucial role in the Indian real estate industry. It has reshaped and developed the industry in terms of transparency and accountability since 2017. RERA also helps in safeguarding the interests and preferences of the buyers.

What is RERA registration?

RERA Registration is an essential requirement for real estate projects that exceed an area of 500 sq.mt. or more than eight apartments. The RERA Act requires all real estate agents to register under the same.

A “Real Estate Agent” is someone who guides others in buying or selling properties. They are commonly known as middlemen, brokers, or property dealers. Their primary tasks include negotiating deals for properties, either renting or purchasing by homebuyers.

Who needs to register under RERA?

Institutions or individuals who advertise, book, sell, or market the plots, apartments or buildings for purchase must have RERA registration. Besides that, any real estate project meeting falling into these categories must register under RERA:

• Land area exceeding 500 square metres.
• Involvement of more than eight apartments.
• Ongoing projects that were not completed before RERA's enactment in 2017 (Passed in 2016)

What is the RERA carpet area?

“Carpet Area” is a term coined by RERA, which provides transparency in property transactions. The Carpet Area of a property is the primary usable space within the four walls of an apartment or house. It does not include balconies, open spaces or outer common space. Any area that the buyer will actually use falls under the RERA Carpet Area.

How is the Carpet Area calculated under RERA?

Carpet Area is calculated by measuring the inner wall-to-wall of the property minus the wall thickness. Rooms like bedrooms, halls/living rooms, & kitchens, and bathrooms are computed under the RERA Carpet Area.

Who does RERA impact?

• Homebuyers: They get clarity in transactions while being charged for the space they will receive.
• Developers: It ensures the credibility of the developer and ensures the timely delivery of the project.
• Real estate agents: Real estate agents must be registered under RERA to ensure ethical practices and minimise fraud.

Key provisions under the RERA Act

• Registration of the projects before advertising, marketing or selling is mandatory.
• Disclosure of all relevant information regarding the project, like layout plan, carpet area, schedule, amenities, etc.
• Escrow Account is to be maintained to safely collect 70% of the total amount received by the buyers.
• Grievances redressal channels are provided to hear and solve the complaints of the buyers or disputes between sellers & buyers.
• Timely completion of the projects. If not delivered, penalties are issued.

The final word

RERA ACT has been the backbone that ensures clarity and accountability in India’s real estate sector. Through Registration, carpet area calculations and the provisions, sellers maintain the standard of the property while ensuring a smooth transaction.