Has RERA, 2016 Effectively Protected Homebuyers Against Builder Malpractices, Or Has Weak Enforcement Diluted Its Impact?
- IJLLR Journal
- 2 days ago
- 2 min read
Shruti Mungikar, Government Law College, Mumbai
I. Introduction
The urgent need to reform India's real estate industry, a major economic engine that had long required regulation, gave rise to the Real Estate (Regulation and Development) Act, 2016 (RERA). For far too long, the industry lacked a single set of rules that it could adhere to, which allowed for enduring problems like ongoing project delays, dishonest marketing, and general lack of accountability. After investing their entire life savings in real estate, homebuyers were left with little choice but to deal with uncertainty and significant legal obstacles.
The Indian Parliament legislated RERA as a law to regulate and promote the real estate industry, to rectify this inherent imbalance between consumers and developers. Its principal objective was, to infuse transparency, fiscal prudence, and a quick justice process, thus helping to restore consumer confidence in the housing market and aid the country's wider urban development and growth objectives.
2. The Pre-2016 Reality
Prior to RERA 2016, the real estate environment functioned with hardly any controls. The real estate business in India functioned under scattered regulatory approaches and without standard practices. Developers enjoyed more freedom in project planning, development, and selling, frequently resulting in delays, quality problems, and conflicts. Buyers encountered difficulties with regard to openness, lack of complete information on the projects, misleading advertisements, and poor grievance redressal systems.
In spite of the sector's massive economic significance, this regulatory lacuna provided fertile ground for exploitation. Misleading advertisements, arbitrary determination of size of property and prevalent opaque financial transactions were typical. With India's urban centres growing at a fast pace, the necessity to have a trusted and clear-cut mechanism to safeguard the homebuyers and to regularize market practices became inevitable.
