Real Estate Redevelopment in 2023 – Things flat owners should keep in mind on redevelopment

The grim reality in the quiet, affluent suburbs of Mumbai is that thousands of these housing societies are deemed dilapidated, meaning to be in a state of disrepair or ruin as a result of years of neglect. While some look at this fact to be roadblocks in reaping the value of your hard earned property, others band together and look at this as an opportunity to unlock a better value by the help of housing redevelopment.

Housing redevelopment refers to the process of reconstruction of a residential premise by demolition of the existing structure and construction of a new one as per approvals from the Municipal Corporation of Greater Mumbai (MCGM).

Redevelopment provides members a brand new home with a greater area and monetary benefits. The best part being it is not on your own dime. Facilities and amenities such as high-end security systems, gymnasiums, car parks only make the property more desirable.

Also, compared to repairs, redevelopment is more sustainable. Repairing any building that is 25 years old will increase its life only by three or four years. It is not structurally or economically feasible.

With a brand new property with amenities, a larger area chances skyrocket that you get a bang for your buck. The process of redevelopment though cumbersome carries with it a greater reward than what you might expect as long as one follows some ground rules.

DO YOUR DUE DILIGENCE

Always appoint a lawyer before signing any contract with a builder. A comparative chart is usually prepared for selection of a builder which contains elements like technical capability, experience, financial status, quality of construction and successful completion of projects. The best way to go about after this is by a tendering system.

The contract once drawn up and looked over by a competent attorney should mention the obligations of the builder and the society and appropriate penalties in case of a breach of contract.

RERA

The project must be covered under the RERA Act, 2016. Ensure that the project timelines and details are updated on the RERA website promptly and accurately.

BE SECURED

The developer is obligated to give a security deposit to the members of the society equaling the entire cost of redevelopment.

GET YOUR ALTERNATIVE ACCOMMODATION

The developer is responsible for giving alternative accommodation to the society members usually in the same area. Members can also seek the cost of shifting from the developer.

GATHER REQUIRED DOCUMENTS

A society planning to undertake redevelopment must possess registration certificate, an original building plan, a lease deed/sale deed, a copy of resolution, an agreement and a title certificate. Property card and an NA (non-agricultural) order are additional requirements for the process. The society’s name must appear in the property card maintained by the City Survey Office as the owner or the subsisting lessee. Else, the society would not be eligible to go for redevelopment as Municipal Corporation will not permit demolition of existing structure and reconstruction.

FSI RULES AND RULES OF AGREEMENT

Builders often violate the rules of FSI by unlawful planning and constructing additional areas that are beyond their entitlement and authority. The buyers of such unlawful properties might land themselves in deals that lead to litigation.