Taking serious note of misleading promotional schemes and ‘assured return’ offers by developers, the Uttar Pradesh Real Estate Regulatory Authority (UP RERA) on Friday issued a public advisory cautioning homebuyers that such promises have no legal validity.
The authority warned that offers such as “assured returns” and “fixed monthly rental income before possession” are often not enforceable under the law, and urged buyers to exercise caution while investing in real estate.
The regulatory authority observed that some real estate promoters continue to publish alluring advertisements offering schemes like subvention plans, pre-EMI payments until possession, fixed rental income before completion, buyback guarantees, lease assurance schemes, and investment plans promising fixed returns on investment. Additionally, offers such as free cars, gold coins, and luxury foreign trips are also used to attract buyers.
Clarifying its position, the authority said that in the absence of proper legal backing, such offers remain mere promotional tactics aimed at influencing buyer behaviour.
“UP RERA is continuously monitoring the sector to curb misleading practices and protect buyers’ interests,” chairman Sanjay Bhoosreddy said.
“Homebuyers should remain cautious of promotional offers like assured returns or fixed rental income, as these are often not legally enforceable under UP RERA. Buyers must rely only on verified information available on the official portal and ensure that all transactions and agreements comply with prescribed norms,” he added.
{{/usCountry}}“Homebuyers should remain cautious of promotional offers like assured returns or fixed rental income, as these are often not legally enforceable under UP RERA. Buyers must rely only on verified information available on the official portal and ensure that all transactions and agreements comply with prescribed norms,” he added.
{{/usCountry}}Referring to the Real Estate (Regulation and Development) Act, 2016, UP RERA said misleading advertisements and false commitments violate regulatory provisions. Under Rules 38 and 61 of the UP RERA framework, strict action, including penalties and fines, can be taken against erring promoters.
The authority reiterated that offers like assured returns or fixed rental income lack legal sanctity unless explicitly incorporated in RERA-compliant agreements.
In its advisory, UP RERA asked buyers to invest only in registered projects and verify all details on its official website. It also stressed the need to carefully read the Builder Buyer Agreement or Agreement for Sale to ensure there are no ambiguous clauses.
Buyers were further advised to make payments only through banking channels into the project’s designated account and avoid cash transactions or reliance on verbal assurances.
Buyers were further advised to make payments only through banking channels into the project’s designated account and avoid cash transactions or reliance on verbal assurances.
Cautioning against risky practices, the authority said bookings should not be made solely on the basis of advertisements or promotional campaigns, especially those promising assured returns, fixed income or lucrative incentives, as these may expose buyers to financial risks.