The Hindu 18.02.2013
Developers of middle-income housing to get incentives under new guidelines
Guidelines classify dwelling units intomiddle-income, low-income
housingDevelopers who build MIG housing to be permitted to build 30 per
cent extra.
A year after the finance minister announced in the Tamil
Nadu legislative assembly that the government would facilitate
developers to build more low-income and middle- income group housing,
norms have been framed to enable it.
According to the
guidelines, which are under the final stages of review, apartments with
dwelling units of 700 square feet, would be classified as middle-income
group (MIG) housing.
Developers who build apartment
complexes dedicated to MIG housing would be permitted to build 30 per
cent more than what is currently allowed. The permissible FSI — floor
space index, a ratio that determines the maximum buildable area in a
given plot — is 1.5 in normal cases, but in apartments dedicated to MIG
housing, it would be enhanced to 1.95.
However, a
State government source said, the prices of these apartments would not
be regulated to meet the affordability criteria as defined by the
government of India. For middle-income groups, the price of the dwelling
unit has to be less than five times the household’s annual gross income
to remain in the affordability bracket.
The
reasoning is that the higher FSI in itself would bring down the land
cost of each unit, which on many occasions is as much as, if not more
than, the construction cost. Secondly, the government thinks it would
not be practical to regulate prices.
Responding to
this proposal, K.P. Subramanian former professor of urban engineering,
Anna University, said: “there is no guarantee that an increase in FSI
will bring the price down. Price is determined by a complex set of
factors. Second, alongside this FSI increase, investment and attention
must be paid to improving infrastructure; otherwise we will only burden
the city further.”
M.K. Sundaram, former chairman of
the Builders Association of India, Southern Centre, said that “this is a
welcome move as long as the increase in FSI is limited to the growing
peripheries of the city.” Any increase within the city would affect
existing infrastructure”. He also remarked that that “increasing the FSI
would not necessarily bring down the selling price of an
apartment.”Apartments with dwelling units of 500 sq. ft. are categorised
as low-income group (LIG) housing and those with 300 sq. ft. are
classified as economically weaker section housing (EWS).
In
2009, the government had enhanced the FSI for developers constructing
LIG and EWS housing to 30 and 50 per cent respectively. However, this
incentive did not attract many developers.