NOIDA – In a significant policy change to boost transparency in real estate transactions, the Noida Authority has mandated a tripartite sale agreement for all new housing projects in the city.
As reported by the The Times Of India, the agreement requires signatures from the builder, homebuyer, and Noida Authority, securing the buyer’s ownership and ensuring transparency at the initial transaction stage.
The decision was announced by Noida Authority CEO Lokesh M after a board meeting led by Chief Secretary Manoj Kumar Singh. The new mandate changes a long-standing practice where property registration would only happen once a project was complete. Now, a sale agreement will be signed and documented with the Noida Authority as soon as a buyer makes the initial 10% payment. Officials believe this shift will help prevent fraudulent sales, which have plagued Noida’s real estate sector for years.
The tripartite agreement addresses a key challenge faced by the city’s homebuyers: lack of transparency in property transactions. Under the new rule, 2% of the required stamp duty will be paid upfront at the time of the first 10% payment, with the remaining amount due upon final possession and registry. Officials say this process will place buyer details in official records right from the start, preventing developers from reselling a unit to multiple buyers or canceling a sale unilaterally.
Previously, developers only entered into agreements with buyers on nominal-value stamp paper, with government involvement limited to final registration after occupancy and completion certificates were issued. The updated rule aligns with Section 13 of the Real Estate (Regulation and Development) Act (RERA), which stipulates that developers cannot accept more than 10% of a property’s cost without a formal agreement. By bringing the Noida Authority into the early stages of the sale, the policy enhances buyer protection, improves oversight, and promotes stamp duty compliance.
This new requirement is intended to protect buyers from unethical practices that have surfaced in Noida’s real estate market, including instances where developers sold the same flat to multiple buyers. In some cases, these fraudulent sales only came to light when buyers sought possession of the property. The tripartite agreement aims to eliminate such cases, enforcing accountability and reducing the likelihood of resale without notification to the Authority.
In addition, officials note that the agreement helps prevent under-the-radar transactions where buyers may sell units back to the developer without notifying authorities. These transactions often bypass stamp duty, leading to significant tax losses. By enforcing the tripartite agreement, the Noida Authority intends to prevent these backdoor transactions and ensure government revenue through proper stamp duty payments.
PPS Nagar, a real estate advocate, commended the policy, noting its potential to prevent the unauthorized resale of units and protect legitimate buyers. “This rule brings an additional layer of transparency, which will deter developers from reallocating units without accountability,” Nagar said.
Noida’s real estate market has been marked by recurring issues with defaulting projects and unregistered transactions. Last year, the state government introduced a rehabilitation package based on recommendations from an expert committee led by senior bureaucrat Amitabh Kant. However, uptake has been slow, with only 29 of 57 defaulting projects in Noida opting into the scheme. Between February and October, the stamp department recorded the registration of 5,925 flats in Greater Noida and 1,643 in Noida under this initiative.
During the recent board meeting, the Authority discussed additional measures to address pending dues from stakeholders and approved the allocation of two plots of over 14,000 square meters each in Sector 154. Originally intended for data centers, these plots will now be allocated to IT and IT-enabled service firms.
Assistant Inspector General of Stamp and Registry, BS Verma, added that this move would benefit buyers by ensuring that developers can no longer alter sale agreements without buyer consent. “The new rule establishes that once an agreement is signed, developers cannot unilaterally make changes, which will better protect homebuyers,” Verma said.
The mandate for tripartite agreements signals a robust step toward safeguarding Noida’s real estate market, aiming to restore buyer confidence and promote fair practices. The Noida Authority’s decision may serve as a model for other regions facing similar challenges in property sales and development.