Highlights: Has Indian real estate merely become a medium to whiten black money, where despite the existence of ‘RERA’, 80% of buyers still feel cheated today? Why is our system proving to be weaker in protecting buyers compared to global markets ?
Although laws like RERA (Real Estate Regulatory Authority) were introduced in the name of reforms in Indian real estate, even today the situation of this sector remains ‘fit from the outside but uncertain from within’. Even today, two-thirds of cases in courts are related to property, which proves that despite the heavy cost and time of litigation, the buyer is troubled. In Aaj Tak Radio’s special show ‘Property Se Fayda’, real estate expert and journalist Ravi Sinha discussed the problems related to real estate openly.
Ravi says— “Whatever claims are being made regarding reforms, they are merely a ‘touch-up’ instead of an actual change. An average buyer needs to understand that there is a deep gulf between the information available to them and the actual ground reality, which no honest effort is being made to bridge. If we compare with global markets like Dubai, their regulator (RERA) becomes active as soon as a project is announced. For example, if a builder introduces a scheme like 20:80, they are immediately summoned, asked for the ‘source of funds’, and the entire amount is deposited into an escrow account.”
“In contrast, RERA in India only talks about securing 70% of the deposits taken from the public. Here, there is no investigation into the builder’s financial capability or the ‘black money cartel’ existing with them. If the flow of funding stops, the project gets stalled, and the investment of the general public goes down the drain.”
Lack of Entry Barrier and Net Worth
Ravi explains that the biggest structural problem of real estate is that there is no ‘entry barrier’ here. Just as the RBI strictly checks the net worth and credentials to open a bank, there is nothing like that in real estate. Anyone can suddenly become a builder here. Until the developer’s background history, their past defaults, and minimum net worth are scrutinized, this sector will not be able to become professional.
An entry barrier does not mean red-tapism, but ensuring the safety of buyers’ money so that no one can take public deposits like a Ponzi scheme.
Ravi states that— “This is the only business model in the world where the customer pays first for something that has not even been built yet. This method of ‘sell and build’ is the most risky. To resolve this, fast-track courts were needed, but after the arrival of RERA, the litigation time has increased even further.
The non-compliance with RERA orders is a bitter truth. The matter drags on for years from RERA to the Supreme Court, due to which an average middle-class buyer gives up hope after getting exhausted.”
Deep Web of Black Money and Vested Interests
The biggest obstacle in the path of reform in real estate is ‘vested interest’. This sector still remains the biggest medium for parking black money. Surveys show that 80% of buyers were dissatisfied in 2011, and the same situation persists in 2025. The disappearance of affordable housing and the rise of luxury housing is proof that the market is running only towards profit. Unfortunately, most of the voices speaking in this ecosystem belong to those who have a ‘conflict of interest’. Until strict policy changes are made keeping the interests of the buyers at the center, this cycle of exploitation will continue.
