Loophole in the RERA Act to help real estate developers

Dated on: Friday 17th November 2017

The Tamil Nadu Real Estate Regulatory Authority has reported a defect in the real estate Act that benefits builders against the provisions of the Act. The RERA Act makes it compulsory for the builders to deposit 70% of the amount received by homebuyers in a separate account. However, the TN RERA Authority informed that there is no mechanism to supervise the accounts of the developers yet.

The only way RERA Authorities can interfere is when there is a complaint filed by homebuyers for misuse of funds against the developer.  

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