REGULATION, TRANSPARENCY AND MARKET STRUCTURE: AN ECONOMIC EVALUATION OF THE REAL ESTATE (REGULATION AND DEVELOPMENT) ACT, 2016 IN INDIA

After India liberalised its economy, business activity rose, and more people moved for work. This pushed up the demand for both homes and commercial space, and real estate soon became an important part of the wider economy. The sector, however, still faces uneven information, frequent project delays, murky financing, and a steady presence of unaccounted money. This paper evaluates the economic implications of the Real Estate (Regulation and Development) Act, 2016 (RERA), which seeks to address these deficiencies through mandatory project registration, disclosure obligations, ring-fenced project finance, and a dedicated adjudicatory framework. The study adopts a doctrinal and analytical approach based on secondary sources. It inspects the macroeconomic setting of the sector, the flow of capital into real estate, the interaction of the sector with the parallel economy, the historical determinants of its market structure, and the effects of RERA on consumers, developers, investors and employment. The analysis advocates that RERA reduces information asymmetry, strengthens buyer confidence and favours well-capitalised, compliant developers, while simultaneously constraining developer liquidity and raising the cost of regulatory compliance. The paper concludes that the economic benefits of the Act depend on the quality of enforcement and on complementary reforms in land markets, housing finance and taxation.