RERA for Registered Valuers
RERA gives a valuer one carpet-area definition and a public record of every registered project. Here is how to use both.
The Real Estate (Regulation and Development) Act, 2016 (RERA) is a consumer-protection law, but it changes valuation work in three practical ways. It fixes one definition of carpet area, it makes a project's approvals, title declaration and progress public on the state authority's website, and it puts money and time obligations on the promoter that affect what an under-construction flat is worth.
For a valuer, RERA is mostly a source of verifiable facts. When a bank asks you to value a booked flat in a Pune project, the project's RERA page tells you whether the project is registered, what carpet area was disclosed, which approvals are pending and what completion date the promoter declared. Those facts feed straight into the comparison and the risk adjustment.
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RERA Terms a Valuer Uses
- Carpet area, s.2(k)
- The net usable floor area of an apartment. It excludes the area under external walls, service shafts, the exclusive balcony or verandah and the exclusive open terrace, but includes the area under internal partition walls.
- Apartment, s.2(e)
- Any separate, self-contained part of immovable property used or intended for residential or commercial use, whatever it is called: flat, office, shop, showroom or godown.
- Real estate project, s.2(zn)
- Developing a building or apartments, converting a building into apartments, or developing land into plots, for sale. It includes common areas, development works and easements.
- Separate account, s.4(2)(l)(D)
- 70% of the amounts realised from allottees must go into a separate scheduled-bank account and be used only for construction and land cost. Withdrawals must be in proportion to completion, certified by an engineer, an architect and a chartered accountant in practice.
Provisions That Move Value
Section numbers are from the Act as it stands on India Code. State rules add detail but cannot dilute these.
3(1) and 3(2)(a)
What it says
No advertising or sale without registration. No registration is needed where the land does not exceed 500 sq m or the apartments do not exceed eight, inclusive of all phases; a state may lower the threshold.
Why a valuer cares
An unregistered project that should be registered is a legal risk to the buyer and the lender.
4(2)(l)(A) and (B)
What it says
The promoter declares, on affidavit, legal title to the land and either that it is free of encumbrances or the details of each encumbrance.
Why a valuer cares
A starting point for title and charge questions, not a substitute for a search.
13(1)
What it says
No more than 10% of the cost may be taken as advance or application fee before a registered agreement for sale.
Why a valuer cares
A booking with a larger unregistered payment is outside the Act's protection.
14(3)
What it says
Structural or workmanship defects notified within five years of possession must be fixed by the promoter within 30 days, free.
Why a valuer cares
Affects the condition adjustment for a recently delivered flat.
17(1)
What it says
Absent a local law, conveyance to the allottee within three months of the occupancy certificate.
Why a valuer cares
A flat sold without conveyance carries title risk.
18
What it says
Refund with interest if the promoter fails to deliver; interest for every month of delay if the allottee stays.
Why a valuer cares
Delay is compensated, which matters when valuing a delayed booking.
59(1)
What it says
Penalty up to 10% of the estimated project cost for not registering.
Why a valuer cares
89
What it says
RERA overrides any inconsistent law.
Why a valuer cares
| Section | What it says | Why a valuer cares |
|---|---|---|
| 3(1) and 3(2)(a) | No advertising or sale without registration. No registration is needed where the land does not exceed 500 sq m or the apartments do not exceed eight, inclusive of all phases; a state may lower the threshold. | An unregistered project that should be registered is a legal risk to the buyer and the lender. |
| 4(2)(l)(A) and (B) | The promoter declares, on affidavit, legal title to the land and either that it is free of encumbrances or the details of each encumbrance. | A starting point for title and charge questions, not a substitute for a search. |
| 13(1) | No more than 10% of the cost may be taken as advance or application fee before a registered agreement for sale. | A booking with a larger unregistered payment is outside the Act's protection. |
| 14(3) | Structural or workmanship defects notified within five years of possession must be fixed by the promoter within 30 days, free. | Affects the condition adjustment for a recently delivered flat. |
| 17(1) | Absent a local law, conveyance to the allottee within three months of the occupancy certificate. | A flat sold without conveyance carries title risk. |
| 18 | Refund with interest if the promoter fails to deliver; interest for every month of delay if the allottee stays. | Delay is compensated, which matters when valuing a delayed booking. |
| 59(1) | Penalty up to 10% of the estimated project cost for not registering. | |
| 89 | RERA overrides any inconsistent law. |
Worked Example: Comparing on Carpet Area
Illustrative round figures. A comparable flat is quoted on super built-up area; the subject flat's agreement states RERA carpet area. Convert before you compare.
Comparable sale price
Working
Given
Result
₹90,00,000
Comparable carpet area
Working
From its RERA disclosure
Result
700 sq ft
Rate on carpet area
Working
₹90,00,000 ÷ 700
Result
₹12,857 per sq ft
Subject carpet area
Working
From the agreement for sale
Result
650 sq ft
Indicated value before adjustments
Working
650 × ₹12,857
Result
about ₹83,57,000
| Step | Working | Result |
|---|---|---|
| Comparable sale price | Given | ₹90,00,000 |
| Comparable carpet area | From its RERA disclosure | 700 sq ft |
| Rate on carpet area | ₹90,00,000 ÷ 700 | ₹12,857 per sq ft |
| Subject carpet area | From the agreement for sale | 650 sq ft |
| Indicated value before adjustments | 650 × ₹12,857 | about ₹83,57,000 |
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Using the RERA Record on a Valuation
- 1
Confirm registration
Check the registration number on the state authority's website against the agreement, and note the phase. Each phase is registered as a separate project.
- 2
Match the area
Compare the carpet area in the agreement with the area disclosed under s.4(2)(h). Any difference needs an explanation in the report.
- 3
Read the declarations
Note the title and encumbrance declaration and the declared completion date. Compare the date with what you see on site.
- 4
Record the approvals
List which approvals the promoter shows as obtained and which are pending, and state the assumption you make about the pending ones.
How the Valuation Examination Tests This
RERA sits in the 7-mark Laws related to Real Estate module and mostly produces one-mark recall questions: the 70% account, the 10% advance cap, the five-year defect period, the 500 sq m or eight-apartment exemption. The usual trap is the carpet-area definition: candidates include the balcony or exclude the internal partition walls, and get both the term and the arithmetic wrong.
FAQs
What is carpet area under RERA?expand_more
The net usable floor area inside the flat, including the area under internal partition walls but excluding external walls, service shafts, the exclusive balcony or verandah and the exclusive open terrace (s.2(k)).
Which projects are exempt from RERA registration?expand_more
Under s.3(2), projects on land not exceeding 500 sq m or with no more than eight apartments across all phases, projects with a completion certificate before the Act began, and renovation or redevelopment that involves no new sale. States can lower the size threshold.
How much of buyers' money must a promoter keep in the RERA account?expand_more
70% of the amounts realised from allottees, used only for construction and land cost, and withdrawn in proportion to completion against certificates from an engineer, an architect and a chartered accountant in practice.
Does RERA registration prove the promoter has clear title?expand_more
No. It records the promoter's own declaration of title and encumbrances under s.4(2)(l). It is a useful lead, but title still has to be checked from the documents and the land records.
Next steps
- Transfer of Property Actarrow_forward
- Title Due Diligencearrow_forward
- Market Approacharrow_forward
- Syllabusarrow_forward
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