Buyers see the word exempt and hear the word unregulated. Those are different things, and the distinction matters a great deal if you are looking at anything small in the Ghats, because almost every boutique villa project in Maharashtra falls on the exempt side of the line. A buyer who treats exemption as a red flag will rule out the entire category of small, well-run developments; a buyer who treats it as meaning there are no rules will fail to insist on the protections that, in a small project, have to come from the contract rather than the regulator. Getting the distinction right is what lets you buy a small project safely.
Where the line sits
The Real Estate (Regulation and Development) Act requires a promoter to register a project with the state authority, MahaRERA in Maharashtra, before advertising or selling it. The Act itself carves out small projects from that requirement: broadly, where the land proposed to be developed does not exceed five hundred square metres, or where the number of units proposed does not exceed eight, inclusive of all phases. A project of seven villas sits comfortably inside that carve-out, and so do most of the intimate, low-density developments that make sense in a hill setting. The phrase inclusive of all phases is the part worth understanding, because it is where the rule has teeth. A developer cannot build eight units, then eight more on adjacent land, and claim two separate exempt projects to stay under the threshold twice. If the land and the intent form a single development, the units count together, and a scheme structured to dodge registration by artificial phasing is not actually exempt. When you assess a small project, it is worth understanding whether it is genuinely small or is one phase of something larger dressed up to look small.
What registration would have given you
Registration brings three concrete things that genuinely protect buyers, and it is worth naming them precisely so you understand what an exempt project does not automatically provide. First, a public project page on the MahaRERA website, carrying the approvals, the promoter's details and a declared completion date, which creates a public, dated record you can check. Second, a requirement that seventy per cent of buyer money goes into a separate account and is drawn only against construction progress, which protects your payments from being diverted to other projects. Third, access to MahaRERA's own complaint mechanism, which is faster and cheaper than a civil court for the disputes that registration covers. Those are real protections, and on an exempt project you have none of them by default. That is not a scandal and it is not a loophole; it is the law working exactly as written, on the reasonable basis that the compliance burden of full registration would be disproportionate for a genuinely small development. But it does mean that the protection which the regulator would otherwise supply has to come from somewhere else, and on an exempt project the somewhere else is the agreement.
Exempt is not unregulated
On an exempt project, the contract is the regulator. Read it as though nobody is coming to help, because nobody is. It is important to be clear that an exempt project is not lawless. It is still bound by the ordinary law of contract, by the land-use and building regulations that govern any construction, and by the sanctioning authority's conditions. What it lacks is the specific, buyer-favouring machinery that RERA registration adds on top of all that. So the right mental model is not that a small project is a wild-west transaction, but that it is an ordinary contractual transaction without the extra regulatory scaffolding, in which the quality of the contract and the counterparty carries the weight that the regulator would otherwise have carried. That reframing is what turns exemption from a worry into a manageable feature. You are not unprotected; you are protected by the contract you negotiate rather than by a public regulator, which means the care you and your lawyer put into the agreement is doing the work. A well-drafted agreement with a solid counterparty can leave you as well protected on a small project as registration would have on a large one, and sometimes better, because the terms are specific to your transaction rather than generic.
What to demand instead
If the regulator is not supplying the protections, the agreement must, and there are four things worth insisting on. A dated possession commitment written into the agreement itself, with a stated consequence if it is missed, rather than a target mentioned in a sales meeting. A payment schedule tied to construction milestones rather than to the calendar, so your money follows the work rather than running ahead of it. The full document set before you pay anything, including title, the 7/12 extract, the NA order and the sanctioned plans. And clarity on who the counterparty actually is, because an operating company with a real business behind it is in a fundamentally different position from a company incorporated for a single project. That last point does much of the work. RERA's escrow requirement exists because buyer money is vulnerable when it sits with a promoter who may not survive the project. On an exempt project you replace that statutory protection with your own judgement about the counterparty, so understanding what else the entity does, what it has completed, and whether it will still exist and still care when the house is delivered is the substitute for the escrow account you are not getting. Milestone- linked payments serve a similar purpose, keeping your money aligned with progress rather than exposed ahead of it.
Track record substitutes for registration
On a small project, a completed track record does much of what registration would otherwise do, because it is evidence rather than promise. It is entirely fair, and it is wise, to ask the promoter to show you something they have already finished, to go and see it, and to speak to whoever owns it now. A promoter who has delivered comparable houses that are standing, occupied and well regarded has demonstrated the thing registration is meant to reassure you about, which is that they will actually complete what they start to the standard they claim. A promoter who has finished nothing is asking you to take the entire project on trust, exempt from registration and unsupported by a record, which is a materially weaker position for a buyer. The absence of registration is acceptable when it is backed by a demonstrable history; it is far riskier when it is backed by nothing but confidence. The track record is the evidence you gather in place of the public project page you would have had under registration, and it is often more informative, because a finished, lived-in house tells you more than a declared completion date on a website ever could.
The escrow protection, and its substitute
The seventy per cent escrow requirement is worth dwelling on, because it is the RERA protection whose absence on an exempt project matters most and is least understood. On a registered project, the bulk of buyer money must sit in a dedicated account and be released to the promoter only against certified construction progress, which stops a promoter using money from one project to fund another and protects buyers if a scheme runs into trouble. On an exempt project this ring-fencing does not apply by default, so your payments are, in principle, less protected against diversion. The substitute a careful buyer builds is a payment schedule tied to construction milestones, which achieves a similar alignment by different means. If your money is released to the promoter only as defined stages of construction are actually completed, then your exposure at any moment is limited to the work already done rather than the whole price paid up front, which is much of what the escrow account was protecting. Combined with a solid, established counterparty who is not dependent on your payments to survive, milestone-linked payments recreate most of the practical protection that statutory escrow would have provided. The protection is available; it just has to be negotiated into the contract rather than supplied by the regulator.
Consumer protection still applies
It is also worth correcting a common overstatement, which is that an exempt project leaves a buyer with no recourse at all. That is not so. The ordinary law still applies: the law of contract, which governs the agreement you sign, and consumer protection law, under which a buyer of a defective or undelivered property retains remedies quite apart from RERA. What exemption removes is the specialised, faster, RERA-specific complaint mechanism, not every avenue of redress. A buyer on an exempt project who is wronged is not without a remedy; they simply pursue it through the general legal channels rather than through the regulator's dedicated forum. This does not make the general channels as quick or as cheap as the RERA mechanism, and it is not a reason to be careless about the contract, which remains your first and best protection. But it does mean that exemption is not the cliff-edge it is sometimes imagined to be. You are trading a fast, specialised regulator for the slower, more general machinery of contract and consumer law, backed by whatever protections you negotiated into the agreement. That is a real and manageable position, especially with a sound counterparty and a well-drafted contract, and it is a long way from being unprotected. The questions that separate a safe small project from a risky one Reduced to a checklist mindset, a handful of questions sort the safe small projects from the risky ones. Is the project genuinely under the threshold, or is it one phase of something larger structured to appear exempt. Who is the counterparty, and what else do they do and own. What has the promoter completed, and can you go and see it. Is the possession date in the agreement with a consequence attached, or only in conversation. Is the payment schedule tied to milestones or to the calendar. And is the full document set available now, before any money moves. Answer those, and exemption stops being a source of anxiety and becomes simply a feature of a category you can evaluate on its merits. The small project is not inherently more or less safe than a registered one; it is safe or unsafe depending on the contract and the counterparty, and the questions above are how you tell which you are dealing with.
A note on completion timelines
One protection registration is often thought to guarantee is a completion date, and it is worth being precise about what an exempt project can offer in its place. A registered project carries a declared completion date on the public record, with consequences under RERA for missing it. An exempt project has no such public declaration by default, which is exactly why the possession commitment must be written into the agreement itself, with a dated deadline and a stated consequence if it slips, rather than left as a target mentioned in conversation. A well-drafted agreement can make that commitment as binding as the registered version, and in some respects clearer, because it is negotiated specifically for your transaction rather than declared generically to a regulator. The test is simple: is the possession date in the contract you sign, and is there a consequence attached if it is missed. If both are true, you have a binding completion commitment whether or not the project is registered. If the date lives only in a brochure or a sales conversation, you have a hope rather than a commitment, and no amount of exemption or registration changes that particular distinction.
How we handle it
Each Eko Estates project comprises fewer than eight units and is exempt from registration under the MahaRERA carve-out for small projects. We treat that exemption as a reason to be more open rather than less, because the protection has to come from transparency and the contract rather than from the regulator. Title documents, 7/12 extracts and NA orders are available for inspection at any time. The draft agreement goes out at the first serious conversation, with the possession commitment and the payment structure on the table to be read before anything is paid. And the entity standing behind the project and the rental is a company already operating a portfolio of houses rather than a vehicle created for a single sale, which is exactly the counterparty distinction this piece argues matters most. Exemption is not a thing to fear; it is a thing to evaluate, and a well-run small project answers every question the regulator would have asked on your behalf.