Separate RERA-like law for redevelopment projects in Maharashtra may confuse homebuyers, say experts
While RERA was introduced to protect homebuyers, it does not cover redevelopment. Such projects are often delayed or fail to take off, leaving flat owners in financial, social, and mental distress. Many are forced to live in transit camps or depend on monthly rent from developers, support that often stops midway.
Real estate experts argue that instead of introducing a separate RERA-like law for redevelopment, the Maharashtra government should work with the Centre to amend and expand the regulatory authority’s scope of Maharashtra Real Estate Regulatory Authority (MahaRERA) to include redevelopment, rather than confusing buyers with multiple laws.
What has the Maharashtra Housing Policy 2025 proposed?
The Maharashtra Housing Policy 2025 has proposed a separate RERA-like law for redevelopment projects. The policy notes that since redevelopment is not covered under the Real Estate Regulatory Authority Act, 2016, complaints related to such projects are not addressed by MahaRERA.
The approved housing policy states, “The RERA Act does not apply to redeveloped properties. A separate law is necessary to regulate such redevelopment projects and properties.”
The policy notes that several redevelopment projects have stalled in the past, leaving homeowners in distress as developers stopped paying them rent.
“Due to several reasons, redevelopment projects either do not commence or get delayed, which results in financial, social, and mental distress for the flat owners. Most flat owners are forced to stay in transit camps or take monthly rent from the developer to arrange for accommodation. Many times, the developer stops providing residential rent. Redevelopment projects get delayed for various reasons,” the policy highlights, noting the need for a separate law.
Also Read: Maharashtra Housing Policy 2025: A separate RERA-like law for real estate redevelopment projects proposed
Should RERA be amended to include redevelopment in its ambit?
Experts have welcomed the move but suggested amending the RERA Act instead of introducing a separate law. Multiple laws, they argue, will only confuse homebuyers and increase compliance for developers, who already register the sale component of redevelopment projects with RERA. Will they now be expected to register the rehab component under a different law as well, ask real estate experts.
A former member of the MahaRERA said, “Rather than having a separate law, the Maharashtra government should work towards working with the Central government for an amendment in the RERA Act for regulating redevelopment projects. We already have the Maharashtra Ownership Flats Act (MOFA), the Co-operative Housing Societies Act and having multiple laws will only confuse the common man.”
“It also increases compliance for developers, considering that they register the sale component of redevelopment projects with RERA authorities. So, later, we expect them to register the rehab component under a separate law? The government should indeed consider increasing the regulatory ambit of the RERA Act to ensure it is amended in a timely manner,” the member said.
Developers in Maharashtra also opine that the state government must work towards covering redevelopment projects under the RERA Act.
“The purpose and intent of RERA was to give justice and ensure that nothing wrong happens with the homebuyers. It has not covered redevelopment. However, if the Maharashtra government wants to handle the grievances of homeowners from redevelopment projects, it should redefine the scope of the RERA Act and widen its scope,” Keval Valambhia, chief operating officer, Maharashtra Chambers of Housing Industry (MCHI), a real estate developers’ apex body in Maharashtra.
“The Maharashtra government can work with the Central government to make necessary amendments rather than coming up with a new law entirely,” Valambhia said.
Also Read: Over 29,000 complaints filed by homebuyers against 5,500 real estate projects in Maharashtra: MahaRERA data
Bombay High Court to decide if RERA applies to redevelopment projects amid ongoing legal debate
According to legal experts, the Bombay High Court is currently deliberating on whether redevelopment projects fall under the purview of the RERA Act.
“Although the Maharashtra State Housing Policy 2025 states that RERA does not presently apply to redevelopment projects and suggests the need for a separate law, the issue is presently pending with the Bombay High Court in Kishor Shamji Thakkar and others versus Sumer Builders Pvt Ltd to decide whether RERA provisions extend to redevelopment projects,” explained Trupti Daphtary, an advocate and solicitor based in Mumbai.
Also Read: Homebuyers and developers can now opt for physical or virtual hearings as MahaRERA adopts a hybrid model
“The answers to these questions would bring much-needed clarity on whether redevelopment falls within RERA’s regulatory framework, and it would help to determine whether the Maharashtra government must legislate afresh for redevelopment, or whether the existing RERA framework would cover it,” Daphtary added.
