The Centre has recently allowed a four-month extension for eligible real estate projects affected by the conflict in Middle East. Ordinarily, builders can face penalties for project delays under the Real Estate (Regulation and Development) Act, 2016 (RERA), while homebuyers may be entitled to compensation. However, the latest advisory treats the Middle East conflict as a force majeure event, allowing eligible projects additional time to complete construction. Here’s what it means for builders and homebuyers.The ministry of housing and urban affairs (MoHUA) has advised state Real Estate Regulatory Authorities (RERAs) to extend the registration and corresponding completion timelines of eligible projects whose original, revised or previously extended completion date falls on or after February 28, 2026.According to the ministry, the situation has disrupted global supply chains, resulting in shortages of construction materials and affecting the timely execution of real estate projects. The extension is expected to provide additional time to developers whose construction schedules have been affected by circumstances beyond their control.The advisory also seeks to simplify the process by allowing state RERAs to issue a common order for eligible projects instead of requiring developers to seek individual extensions.
What it means
Homebuyers could face a longer wait for possession, with the key concern being whether projects that were already delayed due to financial stress, weak execution or developer-related issues may also benefit from the extension.However, the extension is not automatic for every project. State RERAs will have to determine eligibility and implement the advisory under the applicable provisions of the Real Estate (Regulation and Development) Act, 2016.Under Section 18 of the RERA Act, if a promoter fails to complete or is unable to hand over possession of a property as per the agreement for sale, they are required to return the amount received from the allottee along with applicable interest. Homebuyers may also be entitled to compensation under the Act.However, Section 6 of the Act contains a force majeure provision that allows developers to obtain an extension of project completion timelines in the event of unforeseeable and unavoidable circumstances beyond their control, such as war or natural calamities.The Centre’s latest advisory invokes this provision, treating the conflict in West Asia and the resulting disruption to global supply chains as a force majeure event from the Indian perspective. As a result, eligible developers may receive additional time to complete projects without attracting the usual consequences associated with delays under RERA.
