RERA vs Non RERA projects — it’s one of the most important distinctions every homebuyer must understand in today’s real estate landscape. With property purchases involving high stakes and long-term commitments, the question naturally arises: Should I invest in a RERA-registered project or a non-RERA project? While both may appear similar on the surface, the level of legal protection, transparency, and buyer confidence they offer can be worlds apart. In this blog, we’ll explore the core differences between RERA and non-RERA projects, why it matters to you as a buyer, and which option offers greater safety for your investment and peace of mind.
What is RERA?
The Real Estate (Regulation and Development) Act, commonly known as RERA, is a landmark piece of legislation passed by the Indian government in 2016 to bring much-needed transparency, accountability, and structure to the country’s real estate sector. Before RERA came into effect, the real estate market was largely unregulated, leading to frequent delays, miscommunication, hidden costs, and in many cases, legal disputes between buyers and builders. RERA was introduced to protect the interests of homebuyers, ensure fair practices, and improve the overall trust factor in property transactions.
As more buyers begin to evaluate RERA vs Non RERA projects, understanding the significance of RERA becomes crucial. At its core, RERA aims to establish a standardized system where both developers and buyers are accountable, and all property dealings happen in a transparent and fair environment. Under this law, each state and union territory in India has its own RERA authority to regulate real estate transactions and oversee implementation within its jurisdiction.
Key Objectives of RERA
RERA was designed with a few major goals in mind. For buyers comparing RERA vs Non RERA projects, these objectives highlight the security and peace of mind that come with RERA compliance.
- Protection for Homebuyers: To safeguard the interests of buyers and prevent exploitation by builders or agents.
- Transparency in Real Estate Deals: To make information such as project plans, timelines, and approvals easily accessible.
- Timely Project Delivery: To ensure that builders adhere to promised deadlines, failing which, they face penalties.
- Dispute Resolution: To provide a dedicated authority for quick and effective resolution of grievances.
For buyers comparing RERA vs Non RERA projects, these objectives highlight the security and peace of mind that come with RERA compliance.
Major Provisions Under RERA
Understanding these provisions is key when comparing RERA vs Non RERA projects, especially in terms of financial security, legal clarity, and builder accountability. While these projects might differ in price or flexibility, the protections under RERA make it the safer choice for most homebuyers. Here are some of the most impactful features of RERA:
- Mandatory Project Registration: Developers must register their residential or commercial projects with the respective state RERA authority before launching or advertising them. This applies to projects above a certain size or number of units.
- Escrow Account for Funds: Builders are required to deposit 70% of the funds collected from buyers into a dedicated escrow account. This ensures the money is used only for construction and land costs of that specific project, minimizing the chances of fund diversion.
- Disclosure of Project Details: Developers must provide full disclosure of project-related information such as land title, approvals, layout plans, timelines, and any changes to the original plan. This information is available on the RERA website for buyers to verify.
- Clear Definition of Carpet Area: RERA standardizes how the carpet area is calculated, eliminating confusion and overpricing by defining the exact usable space inside a flat or apartment.
- Penalties for Delays: If a builder delays project delivery, they are liable to pay interest to the buyer for every month of delay — just like a bank charges interest for late EMIs.
- Fast-Track Dispute Resolution: Buyers can approach the RERA authority with complaints, and cases are resolved much faster compared to traditional court systems.
What Are Non-RERA Projects?
Non-RERA projects are real estate developments that are not registered under the Real Estate (Regulation and Development) Act (RERA). These projects fall outside the scope of RERA regulations, which means they are not legally bound to follow the strict guidelines and accountability measures laid down by the Act. For homebuyers, this lack of regulation can often translate into greater risk, less transparency, and limited legal protection — a key concern when comparing RERA vs. Non-RERA projects.
There are several reasons a project might not be registered under RERA, some of which are legitimate, while others can be concerning:
- Small-Scale Projects
According to RERA guidelines, only projects with a land area exceeding 500 square meters or more than 8 residential units are required to be registered. Builders of smaller developments that fall below this threshold are not obligated to register their projects under RERA. While this is legally permissible, it still leaves buyers with fewer protections — another important factor to consider in the RERA vs Non RERA projects debate. - Projects Launched Before RERA
Projects that were launched before the implementation of the RERA Act (May 1, 2017) are not required to be registered retroactively. Many of these are referred to as legacy projects, and while some are nearing completion, others may still be under construction — often with unclear delivery timelines, which can be a red flag for buyers exploring RERA vs. Non-RERA projects. - Non-Compliant or Unauthorized Projects
Unfortunately, there are also cases where developers deliberately avoid RERA registration to bypass compliance requirements. These non-compliant projects might lack proper approvals, clear land titles, or financial transparency, putting buyers at a significant disadvantage when evaluating their options between RERA vs Non RERA projects. - Renovation or Redevelopment Projects
In certain cases, if a project is purely a renovation or limited redevelopment without new sales, it may be exempt from RERA registration. However, the legal clarity around these cases can vary from state to state and further highlights the complexities in choosing between RERA vs Non RERA projects.
RERA vs Non RERA projects: Why RERA Homes Are the Safer Bet?
Investing in a RERA-registered project is like wearing a seatbelt in a fast-moving car — it doesn’t eliminate risk completely, but it drastically reduces it. Whether you’re a first-time buyer or a seasoned investor, here’s why RERA is your safest option:
- Legal Protection Against Delays
- Builders must complete projects on time (or pay compensation).
- No false promises – Approved layouts & delivery dates are binding.
- Financial Security
- 70% of funds must be used only for construction (prevents fund diversion).
- Escrow account monitoring ensures money isn’t misused.
- No Hidden Charges
- Price transparency – Builders can’t suddenly increase costs after booking.
- Clear carpet area definition (no misleading “super area” tricks).
- Easy Grievance Redressal
- RERA authorities can penalize builders for violations.
- Faster dispute resolution than consumer courts.
- Reduced Risk of Fraud
- Only RERA-registered projects can advertise & sell.
- No fake approvals – All permits must be verified.
When comparing RERA vs. Non-RERA projects, these advantages clearly show why RERA-compliant developments are the safer, smarter, and more transparent choice for property buyers in India.
Risks of Buying Non-RERA Projects
This comparison highlights why RERA and Non RERA projects are not just about price or location — it’s about long-term value and peace of mind. While they may seem appealing on the surface due to flexible terms or discounts, the potential pitfalls can be severe:
- No Guarantee of Completion
- Higher risk of delays & abandonment (no penalty enforcement).
- Many stuck projects in NCR (e.g., Amrapali, Jaypee) were non-RERA.
- Fund Misuse & Bankruptcy Risks
- Builders can divert money to other projects.
- If the developer goes bankrupt, buyers lose money.
- False Promises & Legal Hassles
- No accountability for changes in layouts, amenities, or delivery dates.
- Buyers must fight long legal battles for refunds.
- Lower Resale Value
- Banks hesitate to finance non-RERA properties.
- Buyers prefer RERA projects for safety, reducing demand.
How to Check if a Project is RERA-Registered?
When making the choice between RERA vs Non RERA projects, this small step can save you from big trouble later. Here’s how you can do it:
- Visit the state RERA website (e.g., UP RERA).
- Search by project name or builder name.
- Verify the approval status, expected delivery date, and any registered complaints.
Pro Tip:
“Never invest in a project without a RERA number. If the builder says ‘registration is under process,’ wait!”
Final Thoughts
Buying a home is a significant emotional and financial decision. In today’s market, the debate around RERA vs Non RERA projects is more relevant than ever. RERA-registered projects are clearly the safer, smarter, and more transparent choice. While non-RERA projects might sometimes offer lower prices or flexible terms, the risks involved can outweigh the benefits.
At AIG Royal, we believe in delivering value through trust and transparency. All our projects are fully RERA-compliant, ensuring that your journey toward owning your dream home is smooth, secure, and stress-free.
Always ask for the RERA number before you buy. Your home deserves nothing less than complete peace of mind.