Real Estate Law

The Role of RERA in Boosting Real Estate Investments in India

RERA rules governing Punjab

Bhanu Pant a 5th-year Law Student specializing in Corporate Law at the School of law, Lovely Professional University has written this blog explaining “The Role of RERA in Boosting Real Estate Investments in India”


Real estate has been a vital sector of India’s economy for decades. It is an industry that has seen significant growth and evolution over the past few years, with more and more investments pouring in every day. The introduction of the Real Estate Regulatory Authority (RERA) in 2016, marked a significant shift in the way the real estate industry operates in India. As a result, there has been a boost in real estate investments in the country. In this blog, we will discuss the role of RERA in boosting real estate investments in India.


Real estate investments refer to any type of investment made in real property or real estate assets. This can include buying and holding rental properties, investing in commercial real estate, sharing ownership in real estate development ventures, or investing in real estate investment trusts (REITs) and other real estate securities.

Real estate investments are often considered attractive because they provide both long-term appreciation and regular income streams. Additionally, real estate investments may offer tax advantages such as the ability to deduct mortgage interest and property taxes. However, like any investment, real estate investments also carry risks and require careful planning and analysis before making any investment decisions.


RERA has not only benefitted homebuyers but also developers. It has brought a level playing field where honest developers are not only appreciated but rewarded as well. RERA has streamlined the process of project approvals, and developers are now required to submit all legal documents and financial statements upfront before launching any project. This has created healthy competition among developers, where only the ones with a good reputation and credentials can thrive in the market.

Moreover, RERA provides developers with more significant financial opportunities, as it requires developers to park 70% of the funds collected from homebuyers in an escrow account. This ensures that developers will complete their projects under the given timeline and that the funds will not be diverted into other projects. RERA, therefore, provides developers with the necessary tools to complete projects on time and build a better reputation in the market, leading to increased investment and profit.


RERA has had a massive impact on the real estate industry in India. The transparency and accountability provided under RERA have instilled a sense of trust and confidence in homebuyers towards the real estate sector. This has led to an increased demand for residential and commercial properties, as people are more willing to invest in the sector.

Moreover, the requirement of keeping 70% of the funds in an escrow account has also encouraged more investors to invest in real estate projects. This has resulted in more capital inflows in the real estate market than before. As developers are now accountable for project completion, investors are willing to invest in projects that are registered under RERA.

Furthermore, RERA has also led to an increase in the number of foreign investments in the Indian real estate market. Due to the transparency and accountability, foreign investors feel more secure in investing in the Indian real estate industry. This has not only led to an increase in investments but has also created more significant opportunities for economic growth and development.


Increased Transparency and Accountability

RERA has made it mandatory for developers to register their projects with the regulatory body and makes it mandatory to disclose project-related information on the RERA website. This information includes project details, approvals, project progress, and financial statements. The transparency and accountability provided by RERA have significantly increased investor confidence and attracted investments in the real estate sector.

Strict Regulations

RERA has put in place strict regulations, such as a mandatory deposit of 70% of the funds raised from homebuyers in a separate account. This ensures that the developer uses the funds towards the construction of the project and prevents the diversion of funds. Additionally, developers can no longer make changes to the project plan without the homebuyers’ consent, providing a high level of protection to homebuyers.

Increased Consumer Confidence

The stringent regulations and transparency provided by RERA have led to increased consumer confidence in the real estate sector. Homebuyers are now more likely to invest in real estate with the knowledge that the regulatory body will protect their interests. This, in turn, has led to an increase in demand for housing and subsequently led to increased investments in the real estate sector.

Stimulated Growth in Affordable Housing

RERA has led to a boost in investments in affordable housing, which is crucial in a country like India, where a significant proportion of the population is unable to afford homes due to high prices. With RERA’s regulations and accountability measures in place, investors are more willing to invest in affordable housing projects, which, in turn, have further stimulated the growth of the sector.

Promoting Foreign Investments

RERA has also encouraged foreign investments in the Indian real estate sector by providing a regulated environment that offers a level playing field for both domestic and foreign investors. The regulatory framework provided by RERA has increased investor confidence and made it easier for foreign investors to navigate the Indian real estate market.


RERA has brought about transparency and accountability in the sector and has also made it easier for foreigners and NRIs (Non-Resident Indians) to invest in real estate in India.

RERA, which was enacted, has made the real estate sector in India more transparent and requires developers to register their projects with RERA and provide all necessary information to the buyers. The transparency and accountability in the real estate sector have made it easier for foreigners and NRIs to invest in India’s real estate, giving them the assurance they need.

Foreigners and NRIs can invest in both residential and commercial properties in India, subject to certain conditions. They can buy and sell property, rent out the property, and even take out a mortgage in India. It is important to note that there are certain restrictions on the amount of money that foreigners and NRIs can invest in real estate in India due to foreign exchange regulations.

RERA has been a positive development for the real estate sector in India and has made it more attractive for foreigners and NRIs to invest in the country’s real estate market. However, it is always important to conduct thorough research and due diligence before making any real estate investment.


  • RERA should have specific provisions to protect investors’ interests, including mandatory disclosure of financial statements, risk factors, and a dispute resolution mechanism. This can help investors make informed decisions and safeguard their investments.
  • RERA should provide incentives for the formation of Real Estate Investments, which can enable small investors to participate in large-scale real estate projects. This can help deepen the real estate market and provide more investment opportunities to investors.
  • RERA should establish an online grievance redressal mechanism to resolve investor complaints in a timely and efficient manner. This can help investors avoid lengthy and costly legal battles.
  • Developers should provide regular updates on project progress to investors, including information on construction status, funding, and approvals. Investors can track the progress of a project in real time through a transparent online platform.


In summary, we can conclude that the real estate sector in India has experienced a significant impact due to the implementation of RERA. Firstly, the regulations have increased transparency, accountability, and protection for homebuyers, thereby boosting their confidence in the industry. Additionally, the fair competition created by RERA has allowed credible developers to thrive, leading to an increase in investments in the sector.

However, while the introduction of RERA has been a significant step forward, there is still a long way to go in making the industry more efficient and transparent. Despite this, experts anticipate that the Indian real estate industry will continue to grow as more people invest in it. Overall, one can assert that RERA has played a crucial role in shaping the Indian real estate sector and is expected to continue doing so in the future.

For a detailed article about the Implementation of RERA in J&K: Click here

[1] RERA And How It Changed The Real Estate Sector, India, available at,way%2C%20buyers%20can%20evaluate%20and%20make%20better%20decisions. Last Visited  ( March  25, 2023).

[2] How Rera Will Impact Real Estate Industry in India?, India, available at Last Visited  ( March  25, 2023).

[3] RERA: Boosting Transparency in Indian Real Estate, India, available at Last Visited  ( March  25, 2023).


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