Buillders are anguished at this order since now they will have no other option but to raise rates by 10-15%.
The best thing is to move out of Mumbai into Pune, Bangalore, Hyderbad or Chennai .There is absolutely no point in paying 1.5 crores to live in 2 bed apt when your salary is a fraction of the loan.
The only people who can buy are those with black money or those whose Mumbai projects are going into redevelopment. Every building over 30 years in age is going for redevelopment and all these residents are getting a good package from the builders.
From what I hear the builders offer
18 months of rent
A lumpsum amount
20-25% extra carpet in the new building.
Many times some owners sell the flat to the builder and move into a different location.
I've seen some projects in my area getting sold out in no time and those flats are sold to mostly investors with deep pockets. End users rarely get a chance to participate in this process.
so the best thing for anyone who can, is to move out and get out of this mess. Ive also noticed a tendency of some of the owners to move to Pune. Today's Times of India - Mumbai edition has a 4 page supplement on Pune real estate. That should speak volumes that Pune builders are courting the Mumbai population with the terms 'affordable' in every other sentence. 3000-5000 per sq/ft seems to be a steal when compared to 10,000 per sq ft in the Mumbai suburbs.
Hindustan times article is below.
Buying a flat in the suburbs will now get even more expensive, after the Bombay High Court on Thursday struck down the state’s decision to increase the Floor Space Index (FSI) for suburban constructions to 1.33 from 1.
The FSI determines the maximum amount of construction that’s allowed on a plot of land. An FSI of 1 means that on a 1,000 sq ft plot, construction cannot be more than 1,000 sq ft.
All new projects have to adhere to the ruling, which came after the April 2008 Government Resolution (GR) was challenged by resident Amit Maru.
This means builders will now have to buy more FSI through Transfer of Developmental Rights (TDR) from the open market. The maximum permissible FSI for suburbs is 2 of which 1 is permitted by default, and builders can acquire the additional 1 through TDR.
In the 2008-09 Budget, the state had decided to offer an additional 0.33 FSI on payment of premium, which reduced the amount of FSI builders had to acquire from private parties. This had, to some extent, reined in TDR prices.
Under the GR, the premium to be paid for the additional FSI ranged from Rs 7,000 per sq ft in areas such as Manori to Rs 23,000 in Bandra.
“We have to pay extra money to buy TDR from the open market and will pass this burden to consumers,” said Sunil Mantri, president of Maharashtra Chamber of Housing Industry and owner of a construction firm.
The court struck down the GR saying it’s against the Maharashtra Regional and Town Planning Act, 1966, as it does not have a provision for levying a premium.
The best thing is to move out of Mumbai into Pune, Bangalore, Hyderbad or Chennai .There is absolutely no point in paying 1.5 crores to live in 2 bed apt when your salary is a fraction of the loan.
The only people who can buy are those with black money or those whose Mumbai projects are going into redevelopment. Every building over 30 years in age is going for redevelopment and all these residents are getting a good package from the builders.
From what I hear the builders offer
18 months of rent
A lumpsum amount
20-25% extra carpet in the new building.
Many times some owners sell the flat to the builder and move into a different location.
I've seen some projects in my area getting sold out in no time and those flats are sold to mostly investors with deep pockets. End users rarely get a chance to participate in this process.
so the best thing for anyone who can, is to move out and get out of this mess. Ive also noticed a tendency of some of the owners to move to Pune. Today's Times of India - Mumbai edition has a 4 page supplement on Pune real estate. That should speak volumes that Pune builders are courting the Mumbai population with the terms 'affordable' in every other sentence. 3000-5000 per sq/ft seems to be a steal when compared to 10,000 per sq ft in the Mumbai suburbs.
Hindustan times article is below.
Buying a flat in the suburbs will now get even more expensive, after the Bombay High Court on Thursday struck down the state’s decision to increase the Floor Space Index (FSI) for suburban constructions to 1.33 from 1.
The FSI determines the maximum amount of construction that’s allowed on a plot of land. An FSI of 1 means that on a 1,000 sq ft plot, construction cannot be more than 1,000 sq ft.
All new projects have to adhere to the ruling, which came after the April 2008 Government Resolution (GR) was challenged by resident Amit Maru.
This means builders will now have to buy more FSI through Transfer of Developmental Rights (TDR) from the open market. The maximum permissible FSI for suburbs is 2 of which 1 is permitted by default, and builders can acquire the additional 1 through TDR.
In the 2008-09 Budget, the state had decided to offer an additional 0.33 FSI on payment of premium, which reduced the amount of FSI builders had to acquire from private parties. This had, to some extent, reined in TDR prices.
Under the GR, the premium to be paid for the additional FSI ranged from Rs 7,000 per sq ft in areas such as Manori to Rs 23,000 in Bandra.
“We have to pay extra money to buy TDR from the open market and will pass this burden to consumers,” said Sunil Mantri, president of Maharashtra Chamber of Housing Industry and owner of a construction firm.
The court struck down the GR saying it’s against the Maharashtra Regional and Town Planning Act, 1966, as it does not have a provision for levying a premium.
