Buying an Under-Construction Flat on Resale in Bengaluru? Under RERA You Are an Allottee Too

A software engineer in Bengaluru booked a flat in a Hebbal tower three years ago, paid a good share of the instalments, and has now been transferred abroad. A young couple wants to take over the flat before it is finished. They agree a price, but one question keeps coming back: if the builder delays possession, or a crack appears in the walls after handover, will the law treat them as the buyer, or are they stuck with whatever the original owner agreed?

The Real Estate (Regulation and Development) Act, 2016 answers the first part directly. Its definition of allottee includes a person who acquires a flat through transfer or sale. This guide explains what that means for a resale buyer of an under-construction flat, using the Housing Ministry's own FAQs on the Act, and what to check before paying the seller.

The short answer. According to the Ministry of Housing and Urban Affairs FAQs on RERA, an allottee under section 2(d) includes a person who acquires an apartment or plot through transfer or sale, but not a person to whom it is given on rent. A resale buyer of an under-construction flat therefore steps into the allottee's position, with the Act's rights and duties. The trade-off: you inherit the protections, but you also inherit the original agreement, the payment schedule and any dues, so the seller's paperwork matters as much as the flat itself.

Who counts as an allottee under RERA?

The person who holds the right to the flat, whether by original allotment or by later transfer or sale. The Housing Ministry's FAQs address the question in plain terms: as per section 2(d), an allottee includes a person who acquires the apartment or plot through transfer or sale, but does not include a person to whom such plot or apartment is given on rent.

The distinction matters in two directions. A family that buys an unfinished flat from the first buyer is not a stranger to the project under the Act; it is an allottee. A tenant who rents a completed flat, on the other hand, is not an allottee, even though they live there. The test is ownership of the right to the flat, not occupation.

That position shapes everything that follows: the information you can ask for, the remedies you can use if possession is delayed, the defect liability after handover, and the duties you take on in return.

Which rights does a resale buyer inherit?

The rights the Act gives to every allottee. The FAQs summarise section 19: it empowers the allottee to obtain information regarding sanctioned plans, layout plans and the schedule for project completion, gives the right to claim timely possession of the booked unit as per the agreement, and entitles allottees to the necessary documents and plans after taking possession.

Delay remedies come from section 18. The FAQs explain that if the promoter fails to hand over possession, the allottee has the right to withdraw from the project and claim a full refund along with interest and compensation, or to stay with the project and receive interest for every month of delay until possession is handed over. We covered the documents allottees can demand in our guide to documents buyers are entitled to under section 19.

After handover, section 14's defect liability applies. The FAQs say the promoter is liable for five years from the date of handing over possession to the allottee for structural defects or any other defects specified, and must rectify them within 30 days, failing which the allottee is entitled to compensation. For a resale buyer of an unfinished flat, possession is usually handed over to them, which is when that five year period begins.

The interest works both ways. The FAQs explain that, under the explanation to section 2(za), the rate of interest payable by the promoter or the allottee in case of default is the same, with the rate specified by the State government in its rules. A resale buyer who pays late owes interest at the same rate the builder owes for delay.

The table below sets out the main rights and duties and what a resale buyer should check for each.

What does the original agreement for sale mean for you?

It is the contract you are stepping into. The FAQs explain that under section 13(2), the State government specifies through rules the agreement for sale to be entered into between promoter and allottee. The agreement is binding on the parties, though it may include other provisions decided between them, and its terms cannot be contrary to the Act and its rules.

For a resale buyer, that means the possession date, the carpet area, the payment schedule and the specifications in the first buyer's agreement are the baseline for your rights. If the agreement promised possession by a certain date, that is the date against which any delay is measured. Read it in full before you agree a price, and ask for the original, not a summary.

The agreement also tells you how much remains to be paid. The FAQs list the allottee's duties under section 19, including payment for the apartment, liability towards interest for delay in payment, the responsibility to take possession, participation in forming the association and registration of the conveyance deed. As the new allottee, those duties fall on you from the transfer onwards.

What should you settle with the seller and the builder?

Three things: what has been paid, what is owed and how the transfer will be recorded. Ask the seller for every payment receipt issued by the builder and a statement of account from the builder showing amounts received and amounts due. Unpaid instalments or interest on late payments are liabilities you do not want to inherit by surprise.

Then ask the builder, in writing, what it requires to record the transfer to you, including any fees, and whether the original agreement for sale will be endorsed or replaced. The FAQs do not set out a transfer procedure, so the builder's written answer and your agreement with the seller are what you will rely on later.

If you are taking a home loan, involve the lender early and coordinate the seller, the builder and the lender before any money changes hands. Plan for the end of the process too: our guide to taking possession within two months of the occupancy certificate explains a duty that will fall on you, as the allottee, at handover.

Before you pay the balance to the seller, ask the builder for a written confirmation that no amounts are outstanding on the flat up to the transfer date. A short letter at this stage can prevent a long dispute later.

How should a Bengaluru buyer approach a resale of an unfinished flat?

As two transactions at once: a purchase from the seller and an entry into a regulated project. The project side is checked on the regulator's portal, as you would for any new booking, whether the tower is a large township or a single building listed on our pages such as L&T Thanisandra. The seller side is checked through receipts, the agreement and the builder's written confirmation. These steps cover both.

1. Confirm the project's RERA registration and declared completion date on the Karnataka RERA portal.
2. Read the original agreement for sale in full, including the possession date and transfer clause.
3. Collect every payment receipt and a builder's statement of amounts paid and amounts due.
4. Ask the builder in writing what it needs to record the transfer and what it will charge.
5. Make sure all instalments and interest due up to the transfer are settled by the seller.
6. Coordinate with your lender before paying the seller anything beyond a refundable token.
7. Keep copies of the transfer documents showing you as the allottee from the transfer date.

Handled carefully, a resale of an unfinished flat gives you the same footing under the Act as the first buyer. Handled loosely, it can leave you paying for someone else's arrears.

What do Bengaluru buyers ask about resale of under-construction flats?

Is a resale buyer of an under-construction flat an allottee under RERA?

Yes. The Housing Ministry's RERA FAQs explain that, under section 2(d), an allottee includes a person who acquires an apartment or plot through transfer or sale. It does not include a person to whom the apartment or plot is given on rent, so a tenant is not an allottee.

Can a resale buyer claim interest if the builder delays possession?

The Housing Ministry's FAQs explain that under sections 18 and 19, if the promoter fails to hand over possession, an allottee may withdraw and claim a refund with interest and compensation, or stay and receive interest for every month of delay. As an allottee, a resale buyer can rely on these provisions.

What should I check in the original buyer's agreement for sale?

Check the promoter, the unit, the carpet area, the payment schedule, the possession date and any transfer clause. The Housing Ministry's FAQs say the agreement for sale under section 13(2) is binding on the parties, though its terms cannot be contrary to the Act and its rules.

Does the five year defect liability apply to a resale buyer?

The Housing Ministry's FAQs say the promoter is liable for five years from the date of handing over possession to the allottee for structural or other specified defects, and must rectify them within 30 days. Since a resale buyer of an unfinished flat is an allottee, the same protection is relevant.

Last updated 2026-10-19. PropNewz Team.