SC remarks may catalyse strengthening of Rera, real estate industry

Supreme Court's sharp remarks on Rera shift focus to weak enforcement, putting pressure on regulators and non-compliant developers while favouring credible players

The Supreme Court’s (SC’s) recent remarks on the Real Estate Regulatory Authority (Rera) are expected to impact the real estate sector by shifting the focus from the strength of the law to the seriousness of its enforcement, experts say.

 

Anuj Puri, chairperson, Anarock, said, “SC’s statement may eventually push for stricter enforcement rules across states, with stronger monitoring of project timelines and escrow accounts. It may also put pressure on regulators to reduce case backlogs, thereby making it more enforcement-driven rather than just on paper. With stricter enforcement, we may yet again see smaller developers who are defaulters exit the market. Developers may also be pushed to focus on faster delivery of projects and further improve transparency.”

 

The SC, on Thursday, sharply criticised the functioning of Reras across several states, stating that they appeared to be doing little ‘except facilitating builders in default’ and suggesting that it was perhaps ‘better to just abolish this institution’.

 

The remarks are likely to push regulators toward stricter oversight, faster adjudication, and more uniform application of rules, thereby raising compliance standards across the board. In the near term, this could increase pressure on smaller or non-compliant developers while benefiting well-capitalised and governance-focused players.

 

Vikas Bhasin, managing director, Saya Group, said, “The SC’s remarks can act as a catalyst for further strengthening the regulatory framework. Positive and practical amendments, along with more uniform implementation, will enhance investor confidence and encourage responsible growth.”

 

Bhavik Bhandari, chief business officer, Ashwin Sheth Group, noted that for developers, the potential transition means a sharper focus on governance, capital discipline, and timely execution.

 

Ever since its implementation eight years ago, more than 99,203 projects and 1,12,051 real estate agents have been registered under Rera across states, according to data from the Ministry of Housing and Urban Affairs (MoHUA). Maharashtra has the highest share of registered projects under Rera, accounting for 50,487, followed by Gujarat with 7,515 projects registered.

 

Abhay Upadhyay, president – Forum for People’s Collective Efforts and member – Central Advisory Council, Rera, MoHUA, emphasised that the SC has not criticised the Rera law, but the way it is being implemented and the Rera institution. “The law is strong. The problem is enforcement. Authorities cannot claim helplessness. They have power under the Act — they must use it,” he added.

 

While projecting an optimistic outlook, industry experts also highlighted scope for improvement. Aarti Harbhajanka, founder and managing director, Primus Partners India, believes that going forward, rather than rethinking the foundational intent of Rera, the focus should be on strengthening and streamlining its implementation.

 

Upadhyay added that repeated general remarks will not fix the system unless accountability is fixed. By imposing ₹10,000-15,000 penalties, authorities are making non-compliance cheaper than compliance. Sending reminders instead of imposing penalties defeats the purpose of regulation. ‘Rera-registered’ has become a marketing line, not a guarantee of compliance.

 

“There is a need to consider targeted amendments to the Act, particularly to establish stronger mechanisms for the completion and revival of lapsed or stalled projects, along with addressing other persistent implementation challenges. There is also an urgent need to operationalise Section 32 of the Act, enabling Reras to actively recommend measures on critical issues such as affordable housing and green housing,” she suggested.

 

The industry stakeholders believe that while criticising Rera, its contribution to the sector cannot be ignored. Heena Chheda, partner, Economic Laws Practice, said, “While the Supreme Court’s scathing critique highlights a painful reality, to dismiss Rera as a total failure is to ignore a monumental structural correction in Indian real estate. By ring-fencing 70 per cent of project receivables in escrow accounts and enforcing a strict carpet-area standard, Rera has choked the systemic fund diversions that once fuelled decade-long delays and a culture of unchecked impunity.”

 

A Knight Frank report says the implementation of Rera curbed speculative pricing and aligned housing prices with market fundamentals, helping the residential sector recover after the previous downturn. Improved affordability and stronger regulatory processes boosted investor confidence, with cumulative private equity inflows rising to $26 billion in 2017-2020 from $17.5 billion in 2011-2016.

 

There are visible positive impacts, especially in Maharashtra, Karnataka, Uttar Pradesh, Madhya Pradesh, and Haryana. As of February 9, 2026, 35 states/UTs have notified general rules (except Nagaland), while 27 states/UTs and two interim bodies have set up active Real Estate Appellate Tribunals. Together, they have disposed of over 1.55 lakh cases, with Uttar Pradesh leading (52,047), followed by Maharashtra (27,006), Haryana (16,531), and Karnataka (10,169), Puri noted.

 

The next phase, however, must focus on deepening effectiveness rather than merely ensuring compliance. The framework is in place, but outcomes depend on consistent enforcement across states and faster, more predictable dispute resolution, according to Vivek Rathi, national director – research, Knight Frank India.

 

·         Over 99,203 projects and 1,12,051 agents registered under RERA; 35 states/UTs have notified rules and 1.55 lakh+ cases have been disposed of, with UP (52,047) and Maharashtra (27,006) leading.

 

·         Supreme Court remarks seen as a wake-up call on enforcement, not a rejection of the law.

 

·         Experts say weak enforcement, low penalties, and case backlogs are key bottlenecks.

 

·         Post-RERA, the sector saw greater transparency, escrow discipline, and consolidation, with speculative pricing curbed and private equity inflows rising to $26 billion (2017-20) from $17.5 billion (2011-16).

 

·         Stronger implementation could push out smaller defaulters, benefit credible developers, and drive a more stable, investor-friendly real estate ecosystem.