Buy 1800 sq ft, Get 1000, Housing Industry Chamber Says Developers Digging Own Graves

SALEABLE AREA From 40 per cent of carpet area, jacked up to 60-100 per cent; housing industry chamber says developers digging own graves

Aspiring home buyers, already grappling with spiralling prices, have a new problem: developers are jacking up the sale able area in most new projects by "unrealistic proportions".

Developers sell flats not on the basis of carpet area (the net usable wall-to-wall area) but on the basis of sale able area, also known as super built up area, which includes facilities like staircase, lobby and lift as also add-ones like sun decks.

Traditionally, these spaces have been limited to a maximum 40 per cent of the carpet area. Of late, developers have increased this notional "loading" to 60 to 100 per cent of the carpet area. As a result, a flat-buyer paying for a 1,800-sq-ft flat may end up with only 1,000 sq ft floor area to live in.

"We have tried explaining to developers that we are digging our own graves by resorting to such practices. The MCHI (Maharashtra Chamber of Housing Industry), time and again, appeals to developers to stick to selling flats on carpet area basis but we cannot impose any regulation on them," said real estate developer Pravin Doshi, president of MCHI.

Two years ago, the government had approved a Bill, whereby any developer who does not sell flats according to carpet area is liable to face imprisonment for a period of three years, a rule that has failed to take off with no one appointed to oversee implementation.

Developers, on the other hand, get to maximise their profits as the BMC rules allow them to build parking lots, elevators and other frills free of FSI. Also, developers are allowed to build four-foot pro jections in the form of sundecks or flower beds in addition to building a balcony free of FSI and enclosing it as part of the flat.

"We had to discontinue giving permission for such projections as they were mostly misused. But recently the BMC has started sanctioning these once again," said an official from the building proposals department.

This is the very reason why balconies, which had mysteriously disappeared from facades of flats in Mumbai, have made a comeback in new projects along with fancier versions like sun decks, viewing gallery, planter's box and individual terraces.

All these were earlier charged at one-third the rate (per sq ft) for the flat, but now everything is sold at a flat rate. Brochures of new launches by Orbit Corporation, Dheeraj Realty, Wadhwa Developers, RNA Corp, Lodha Group, Oberoi Constructions, Indiabulls, DB Realty and a string of many others show a huge discrepancy between the actual usable space and the saleable space the buyer is made to pay for.

Real estate experts said there is an upper cap of 2 on FSI in the suburbs, but by constructing the components free of FSI and selling them at market rates, developers effectively get an FSI up to 3 or 4.

"In the absence of a regulator, loading is sort of an eyewash by developers to salvage high land costs.

So while per-sq-ft rates in Ghatkopar is Rs 9,000, with loading the rates are as good as being a high Rs 13,500. While actual rates in Bandra-Khar are Rs 20,000 to 25,000 per sq ft, customers end up paying up to Rs 45,000 per sq ft of the usable area due to huge element of loading," said property consultant Sandeep Sadh.