Up Changes Rules, Realtors Can’t Build First And Regularise Later, ET RealEstate

December 15, 2023
1 min read
uttar pradesh government changes rules developers cant build first regularise later

GHAZIABAD: The UP government’s new guidelines on purchasable floor area ratio (FAR) deem any additional FAR illegal and subject to demolition if applied after construction has taken place, a practice widely prevalent in NCR.

In multi-storey buildings, developers until now could buy FAR in case of slight deviation from the sanctioned layout map.

“Simply put, extra FAR allowed builders to build more. To apply for additional FAR, developers could approach the development authority while seeking a completion certificate if additional construction was noted during the project’s inspection,” a GDA official said.

But this had drawbacks, the primary ones being complaints from residents about violations and realtors not regularising additional built-up areas. Additional construction will now be allowed only with the prior purchase of FAR.

At present, the permissible FAR — the ratio of a building’s total floor area to the size of the plot on which it is built — for plotted developments and group housing is 1.5 FSI (floor space index) in the city and 2.5 on its outskirts, and the rate is about 40% of the land rate. Purchasable FAR, meanwhile, was allowed only on 25% extra construction in the built-up area and 33% in open area.

“The exercise of applying for purchasable FAR post construction for seeking completion certificates often led to disputes between developers and the development authority, with some of the cases reaching the courts. The GDA also incurred losses as it could not earn any money through purchasable FAR till the legal proceedings were over. In other cases, demolition of unauthorised construction proved to be tricky and cumbersome,” the official said.

The new guidelines will allow a realtor to purchase FAR only once — at the time when the project’s map is submitted for approval. It also adds that any extra construction, noted during inspection or otherwise, will be razed.

“Completion certificate will be issued after the development authority is satisfied that the construction aligns with the approved project map,” the official said.

The government has also introduced changes in project renewal fees allowing realtors to pay only for the part of a project which remained unfinished after the stipulated five-year construction period and a subsequent three-year extension. The move is expected to benefit developers of several stalled real estate projects in Noida and Greater Noida.

According to GDA, realtors are usually given five years to complete housing projects. In case, a project remains unfinished, the developer is given three more years to complete the construction. If the developer still fails to finish the project, the development authority, until now, would charge a renewal fee for the entire project. According to new rules, the renewal fee will be charged only for that part of the project which is unfinished.

  • Published On Dec 14, 2023 at 08:52 AM IST

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