RERA, the Real Estate (Regulation and Development) Act, 2016, gives home buyers in India enforceable rights: accurate project information, possession on the promised date, a fair agreement, and refund with interest or compensation if the promoter defaults. It also forces most new projects to register with the state authority before they are advertised or sold. In Tamil Nadu that authority is TNRERA, and its rules apply to projects in Coimbatore just as they do in Chennai.
Key takeaways
- Projects on land above 500 sq m, or with more than eight apartments or plots (all phases counted), must register with the state RERA before marketing or sale.
- A promoter cannot take more than 10% of the price as advance before a written agreement for sale is registered.
- 70% of buyer money must sit in a separate project account and be used only for land and construction of that project.
- If possession is late, you can withdraw with a full refund plus interest, or stay and get interest for every month of delay.
- Structural defects reported within five years of possession must be fixed free of cost within 30 days.
What RERA is and why it exists
Before 2016, a buyer who paid for an under-construction flat had few practical options if the builder changed the plan, diverted money or simply stopped work. Civil suits took years. RERA created a regulator in every state, a fast-track complaint system and clear duties for promoters (the Act’s word for builders and layout developers). Tamil Nadu notified its rules in 2017 and set up the Tamil Nadu Real Estate Regulatory Authority (TNRERA).
Which projects are covered
Under Section 3, a project needs registration unless the land is 500 sq m or less and it has eight or fewer apartments across all phases. Plotted layouts are covered too, so a large residential plot layout near Saravanampatti or Kovilpalayam must carry a RERA number just like an apartment tower. Projects that had a completion certificate before the Act came into force, and renovation work that does not involve marketing new units, fall outside it.
Real estate agents must also register. If a broker markets a registered project, the agent’s own registration number should be available on request.
Your core rights as an allottee
| Right | What it means in practice | Section of RERA |
|---|---|---|
| Information | Sanctioned plans, layout, specifications and stage-wise schedule must be available to you | Sections 4, 11 and 19(1) |
| Carpet area pricing | Price must be based on carpet area, the usable floor area inside walls, not an inflated “super built-up” figure | Section 2(k) |
| Cap on advance | No more than 10% before a registered agreement for sale | Section 13 |
| No change without consent | Plans and specifications cannot be altered without your consent; common area changes need two-thirds of allottees | Section 14 |
| Timely possession | Refund with interest if you withdraw, or monthly interest if you stay, when possession is delayed | Section 18 |
| Defect liability | Structural defects or poor workmanship reported within five years must be fixed within 30 days at no cost | Section 14(3) |
| Title and conveyance | Promoter must execute the sale or conveyance deed and hand over documents and the association’s common areas | Sections 11(4) and 17 |
The escrow rule
Section 4(2)(l)(D) requires 70% of amounts collected from buyers to be kept in a separate bank account and withdrawn only in proportion to completed work, certified by an engineer, an architect and a chartered accountant. This is the single biggest protection against money from your project being used to buy land elsewhere.
Interest rate in Tamil Nadu
The Tamil Nadu Real Estate (Regulation and Development) Rules, 2017 fix the interest payable by a promoter or allottee at the State Bank of India’s highest marginal cost of lending rate (MCLR) plus 2%. The same rate applies both ways, so a late-paying buyer is charged the same rate a late builder must pay.
Your duties as a buyer
RERA is not one-sided. Section 19 requires you to pay instalments on time, pay registration charges and maintenance, take possession within two months of the occupancy certificate and join the association of allottees. Missing payments can attract interest at the same prescribed rate, and repeated default can lead to cancellation as per the agreement.
How to use RERA before you pay anything
- Ask for the RERA registration number and check it on the TNRERA portal. Compare the promoter name, survey numbers and completion date with the brochure.
- Download the uploaded approvals: building permit or DTCP/LPA layout approval, title documents and the sanctioned plan.
- Read the quarterly progress updates. A project that has stopped reporting is a warning sign.
- Insist on a registered agreement for sale before paying more than 10%.
- Pay only into the account named for the project, and keep every receipt.
For plots, pair these checks with the land-record checks in our guide to patta, chitta and EC. RERA registration does not by itself certify clean title.
What happens when things go wrong
You can file a complaint with TNRERA under Section 31 for violations of the Act, rules or your agreement. Claims for compensation go to the Adjudicating Officer. Orders can be appealed to the Tamil Nadu Real Estate Appellate Tribunal, and from there to the Madras High Court. A promoter who appeals must first deposit at least 30% of the penalty, or the full amount payable to the buyer, which discourages delaying tactics. Our guide on delayed possession remedies explains the choice between RERA and consumer commissions.
Frequently asked questions
Does RERA apply to resale flats?
RERA mainly governs promoters of new or ongoing projects. When you buy from an individual owner, RERA rights against the original promoter (such as the five-year defect liability) may still be relevant, but the sale itself is an ordinary transfer governed by the Transfer of Property Act and registration law.
Are small plotted layouts covered by RERA?
Only if the land exceeds 500 sq m or there are more than eight plots across all phases. Smaller layouts can be exempt, so you must rely on DTCP or local planning approval and title checks.
Is a RERA number proof that the project is approved and the title is clear?
No. Registration means the promoter has disclosed approvals and documents, but TNRERA does not guarantee title. Have an advocate examine the documents.
What interest will I get for delayed possession in Tamil Nadu?
The Tamil Nadu rules fix it at SBI highest MCLR plus 2% a year. Check the current SBI MCLR on the bank’s website when calculating.
This article is general information as of September 2026, not legal, tax or financial advice. Rules and rates change; confirm with a qualified advocate, chartered accountant or the relevant department before you act.
References
Buying into a new project in Coimbatore?
We help buyers shortlist RERA-registered apartments and layouts and walk through the approvals before any money changes hands.
