Homebuyers get stronger rights: Karnataka's apartment law, UP RERA's new maintenance rules explained

Apartment owners in Karnataka and Uttar Pradesh could soon benefit from stronger legal protections as both states introduce significant housing reforms aimed at improving transparency, accountability and governance in residential projects. While Karnataka has proposed a new law to overhaul apartment ownership and redevelopment, the Uttar Pradesh Real Estate Regulatory Authority (UP RERA) has tightened rules governing maintenance funds collected from homebuyers.

Together, the measures seek to address some of the most common issues faced by apartment buyers—from ownership disputes and ageing buildings to the handling of maintenance corpus after possession.

Karnataka plans a single law for apartment ownership

The Karnataka government has proposed the Karnataka Apartment (Ownership and Management) Bill, 2026, which seeks to replace two laws that have governed apartment ownership for more than five decades. According to PTI, the Bill will repeal the Karnataka Apartment Ownership Act, 1972 and the Karnataka Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1972.

The government says the existing legal framework no longer reflects the realities of modern apartment living and is not fully aligned with the Real Estate (Regulation and Development) Act (RERA), 2016. The proposal assumes significance given the rapid growth of apartment housing in Bengaluru, which, according to PTI, has more than 25,000 apartment buildings comprising an estimated 2.5 million to 3 million flats.

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The proposed law will apply to projects with more than eight apartments. It clearly separates ownership rights from management responsibilities by recognising apartment owners as the legal owners of the project land and common areas, while apartment associations will be responsible only for maintenance, administration and management. It also defines concepts such as private area, super built-up area and the method for calculating an owner's undivided share to reduce disputes.

Structural safety and redevelopment

The Bill introduces fresh safeguards for ageing apartment buildings. Complexes more than 30 years old will have to obtain a structural stability certificate every five years.

For older projects where common areas were never formally transferred, the proposal introduces deemed conveyance, enabling apartment owners to secure legal ownership without lengthy litigation. It also lays down a redevelopment framework under which at least 75% of apartment owners must approve redevelopment, while dissenting owners must receive compensation of at least twice the market value, according to PTI. A dedicated appellate authority with powers equivalent to a civil court has also been proposed for faster dispute resolution.

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UP RERA tightens maintenance fund rules

Meanwhile, UP RERA has overhauled the rules governing Interest Free Maintenance Security (IFMS), the one-time maintenance corpus collected from homebuyers for long-term upkeep of common facilities.

Under the amended regulations, builders must deposit all IFMS collections into a separate designated bank account with a scheduled bank instead of mixing the money with project funds. The corpus must be invested in the fixed deposit offering the highest available interest rate.

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After handing over common areas, developers must transfer the entire maintenance corpus, the interest earned and a detailed statement of accounts to the Residents' Welfare Association (RWA) or Association of Allottees. The money can only be used for maintenance, repairs, replacement of common assets and operation of shared infrastructure.

The new rules also make annual audits by a Chartered Accountant mandatory and standardise IFMS charges across residential and commercial projects to improve transparency and accountability.

Why the changes matter

Taken together, the Karnataka proposal and UP RERA's amendments represent a broader push to strengthen apartment owners' rights. By providing greater clarity on ownership, creating a structured redevelopment framework, safeguarding maintenance funds and introducing stronger financial oversight, the two initiatives aim to reduce disputes between developers, apartment associations and homebuyers while improving governance in residential communities across the two states.

(With PTI inputs)

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