Maharashtra Real Estate Crisis: 33% Projects Lapsed, Stakeholders Demand Robust RERA Reforms to Ensure Compliance

Maharashtra’s real estate sector is grappling with a crisis as approximately 10,700 out of 32,000 active projects have lapsed due to failure in meeting Real Estate Regulatory Authority (RERA) timelines. This amounts to nearly 33% of total projects, raising serious concerns over compliance as developers struggle to submit Form 4 along with the mandatory Occupancy Certificate (OC) before the RERA deadline.

Lapsed projects refer to those where the timeline set by RERA has expired without adherence to key compliance requirements. In addition, the state faces issues with several stalled and non-active projects that have not officially lapsed but remain dormant, exacerbating the situation for developers, buyers, and investors.

Advocate Vinod Sampat, President of the Cooperative Societies Users Association, has called for urgent reforms, stressing the need for stricter enforcement of RERA regulations. "Builders who violate rules should face non-bailable offenses, and every construction site must clearly display the proposed stages of work," said Sampat. He suggested that occupancy licenses should only be issued after the completion certificate is granted, and developers should be barred from selling 10% of the constructed area until the flats are handed over with all clearances in place.

Sampat criticized the existing RERA framework, calling it a "paper tiger" and highlighting how it has consistently failed to monitor and control non-compliant builders. He urged authorities to adopt a buyer-first approach, suggesting that developers should not be allowed to launch new projects until they clear previous liabilities ordered by the court. "Why should flat buyers receive just 9% compensation and be forced to run from one office to another for approvals, registration, and duties?" he questioned.

Despite these challenges, Maharashtra remains a leader in RERA registrations, with over 32,000 active projects and 29,000 registered real estate agents. Domnic Romell, President of CREDAI-MCHI, acknowledged the sector’s commitment to compliance, stating, "While 67% of projects are compliant, the fact that 10,700 have lapsed warrants immediate attention. This high lapse rate highlights systemic issues rather than a lack of willingness to follow timelines. Developers and government authorities must collaborate to safeguard homebuyers’ interests and restore market stability."

Dhaval Ajmera, Secretary of CREDAI-MCHI, pointed out key challenges developers face in maintaining compliance, including rising construction costs, delays in obtaining approvals, and issues related to GST, such as the unavailability of input tax credit. He emphasized the need for clearer procedural guidelines from MahaRERA to reduce lapses.

Raajesh Prajapati, Founder President of CREDAI-MCHI Raigad, advocated for a more balanced approach, including recognizing certain delays as force majeure under RERA. "By addressing procedural hurdles and introducing pragmatic reforms, we can reduce project lapses and strengthen the long-term sustainability of Maharashtra’s real estate market," he said.

As calls for reforms grow louder, stakeholders hope that MahaRERA will respond with decisive measures to improve compliance, rebuild buyer confidence, and stabilize the real estate sector. Whether stricter regulations and collaborative efforts will steer the sector toward sustainable growth remains to be seen.