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Understanding Property Laws for Buyers in India

September 26, 2023

Investments in Indian real estate have been witnessing an upward swing post the pandemic. Especially with the strong economic growth in India, encouraging regulatory framework and the addition of REIT. The purchasing power has substantially increased with the boom in diverse business models, including tech, venture capital, social media and start-ups.  

As with any investment, there are multiple property-related laws and this can vary across states. Over the years, various central and state-specific regulatory updates on matters relating to real estate laws in India have been made by the higher judiciary. This strictly acts as a judicial precedent when it comes to buyer property laws in India. However, apart from the common property laws, the sector also takes into account the multiple state or local or municipal laws, customs and policies. 

Depending on the court or forum passing an adjudication, property rules protect buyer or seller interests and enhance the reliability of the real estate sector. The laws pertaining to real estate investment by Non-resident Indians (NRI) can be a little different though. If you are looking to purchase land or a completed commercial/residential project, it is necessary to be aware of the important laws governing real estate in India. 

Here are some of the key legislations that the purchase of land or property should adhere to: 

  • The Real Estate (Regulation and Development) Act, 2016 (RERA):  This is one of the most important laws for buyers as the purchase of property falls under RERA. The law was formulated to safeguard the interests and rights of consumers in the real estate sector. Under the purview of this law, disputes can be speedily addressed through the Real Estate Regulatory Authority and the Appellate Tribunal. Before you invest in a property ensure that the project is registered under RERA as this is a mandatory requirement for all builders. 
  • Transfer of Property Act, 1882: This is a central act and lays down the ground rules and general principles of ownership of immovable assets. The exchange, sale, lease, mortgage and gift of property comes under this law and the transfer can only be made by registered documents, as enumerated in the Registration Act, 1908. 
  • Registration Act, 1908 and Indian Stamp Act, 1899: This act governs the laws pertaining to payment of stamp duty and requirements for registration of various deeds, documents and instruments relating to the transfer of immovable property. Stamp duty costs are to be paid to the state government by the buyer for property registration and this can vary from state to state. 
  • The Indian Contract Act, 1872: This act ensures that every contract in India is executed and implemented on fairgrounds and that remedies will be made available to the involved parties in the event of any breach of laws. 
  • Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013: This India property law ensures the fair undertaking of the acquisition of private lands by the Government for certain public purposes or for a company. 
  • Foreign Exchange Management Act, 1999 (FEMA) and Foreign Direct Investment Policy (FDI Policy): This act governs the purchase/sale of immovable property in India by foreign entities or NRIs. Under the act, certain compliance parameters are laid down by the government, the Department of Industrial Policy and Promotion (DIPP) and the Reserve Bank of India (RBI) for foreign investment in the real estate sector 


Before committing to real estate investment of any sort, it goes without saying that doing thorough due diligence is crucial. Make sure all the necessary documents are in place and every real estate law is adhered to. Even the smallest mistake can cost you big and get you embroiled in long-winding legal disputes.  

Having real estate laws and building by-laws in place also helps to ensure that the purchased projects are safe and meet minimum standards for quality. Building code violations could result in serious and life-threatening mishaps.  

It is also important to understand that apart from these property laws for buyers in India, there are various other laws with respect to urban development, rent control, apartment ownership, building codes/by-laws, property tax, Special Economic Zones (SEZs), Benami transactions, environmental protection and more.  

Research Links: 

  1. https://iclg.com/practice-areas/real-estate-laws-and-regulations/india
  2. https://www.99acres.com/articles/what-are-the-fundamental-laws-that-govern-real-estate-in-india.html
  3. https://www.lawyered.in/legal-disrupt/articles/property-laws-india/
  4. https://www.cnbctv18.com/real-estate/how-to-invest-in-real-estate-in-india-9730421.htm
  5. https://www.legalreader.com/why-is-real-estate-law-important/

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