In a move infused with pre-poll populism, the government has decided that 20 per cent of each plot measuring an acre or more will have to be reserved for the underprivileged.
A notification issued by the state’s urban development department (UDD) in the first week of November makes it obligatory for developers to hand over a fifth of the plot or houses built on the plot to Mhada. The state housing authority can then give it away to the Economically Weaker Sections (EWS) and Lower Income Groups (LIG) in its housing lottery.
The treat for the poor, a vision of which was marketed by the Congress-led state government as ‘inclusive housing’ in its housing policy announced in 2007, comes right before the upcoming general elections. The UDD, which is headed by Chief Minister Prithviraj Chavan, took a year to approve the modifications in the Maharashtra Regional Town Planning (MRTP) Act to pave the way for enlarging affordable housing for the poor. The file, on the pertinent notification under section 37 (1AA)(c) of the MRTP Act, was pending since the deputy director of town planning submitted his report to the government on November 8, 2012.
Incidentally, in approving the provisos, the chief minister has closed his eyes to an existent contract that provides affordable housing equally expansively. It was a joint venture between the government and the Maharashtra Chamber of Housing Industry (MCHI) for construction of five lakh affordable homes in Mumbai and surrounding areas came, which was entered into on June 1, 2010 in the presence of then chief minister Ashok Chavan. But it has seen no translation from paper into reality.
Paras Gundecha, ex-president of MCHI and proprietor of Gundecha Builders, said the government’s move was agreeable, but lengthy. “We welcome the move as it will create a housing stock for people that fall in the LIG category. But the process seems lengthy since the Mhada will purchase the stock within a period of six months. Also, the rate we will get from the government will be around Rs 1,400 to Rs 1,500 per sq ft if the market price is between Rs 3,000 and Rs 3,500. I am afraid the process may take more than 2-3 years to yield results.”
Sachin Ahir, minister of state for housing, said the government’s decision is aimed at maximising housing stock for people belonging to economically weaker sections and lower income groups. “But it requires more and more development in the housing sector. Also, people who are going to be benefitted from the plan should occupy these tenements and not resell them to shift elsewhere,” he said.
The terms and conditions
The changes notified under the MRTP Act stipulate that:
>> At least 20 per cent of the plot of land with an area of one or more acre (4,000 sq m) will be set aside for EWS and LIG, either as plots of 30-50 sq m or as tenements measuring 325 sq ft and 542 sq ft.
>> These plots will be sold to Mhada at existing ready reckoner rates.
>> Mhada will purchase this stock from the builder at the rate of construction and allot it to the winners of its housing lottery.
>> In return, the developer will get an additional FSI, equivalent to 20% of the land, which he can use on the remaining area.
>> If Mhada declines to purchase the plots within six months, the developer can sell them in the open market. In this case, no additional FSI would be granted.
>> The civic body will not issue occupation certificates (OC) for flats constructed for sale in the market, unless they fall under affordable housing stock.
>> The landowner or developer will be permitted to use a quarter of the 20 per cent FSI for erecting service quarters, but in a separate block on the same plot. These will have to be sold as service quarters for commercial use, the notification says.
>> The affordable houses or plots cannot be amalgamated.
>> The benefits do not extend to housing schemes or residential projects for which commencement certificates were issued before the changes were notified.