Summary of this article
Developers may collect 75-80% before registration.
Buyers could retain 20% until registration.
Proposal aims to reduce homebuyer financial risk.
Maharashtra is considering a major change to property payment rules that could give homebuyers greater financial protection during the purchase of under-construction homes. The state government plans to amend the Registration Act to prevent developers from collecting the entire property consideration from buyers before a project reaches completion and final registration.
Under the proposed framework, developers may be permitted to collect only around 75-80 per cent of the property’s total value at the Agreement for Sale (AFS) stage. The remaining 20 per cent would have to be paid at the time of final registration, according to a report by Hindustan Times.
What Changes for Homebuyers?
The proposal could significantly alter the payment structure for under-construction properties. At present, buyers end up paying a substantial portion, and in some cases almost the entire consideration, during the construction period, depending on the payment schedule agreed with the developer.
If the proposed amendment is implemented, buyers would retain 20 per cent of the property’s value until the final registration. This could provide an additional financial safeguard in cases where construction is delayed, possession is postponed, or other project-related issues arise.
For instance, on a property worth Rs 1 crore, a buyer could potentially be required to pay a maximum of Rs 75 lakh-80 lakh before final registration, with the remaining Rs 20 lakh-25 lakh payable at the final registration stage. The exact limit, however, will depend on the final legislation.
Why is Maharashtra Considering the Move?
The proposed change is aimed at reducing the financial exposure of homebuyers. For a buyer, paying most of the property’s cost well before receiving the completed home can create significant financial risk if a project faces delays or complications.
Keeping a portion of the consideration payable at final registration could also give buyers greater financial leverage until the project reaches completion.
The move would require an amendment to the state’s Registration Act, and the proposal is, therefore, not yet an enforceable rule. Its final scope and implementation will depend on the legislation eventually introduced and approved by the state government.
What Could it Mean for Developers?
For homebuyers, however, the proposal could represent a significant shift towards greater payment-linked protection.
Until the amendment is implemented, buyers should continue to follow the terms of their registered Agreement for Sale and applicable real estate regulatory authority (Rera) provisions. If implemented, Maharashtra’s proposed 80 per cent payment ceiling could become an important consumer-protection measure, ensuring that buyers retain a meaningful portion of their financial commitment.
