Thursday, July 25, 2024

Uttar Pradesh Government Implements Stricter Guidelines for Purchasable FAR in Real Estate

In a significant move, the Uttar Pradesh government has introduced new guidelines regarding purchasable Floor Area Ratio (FAR), labeling any additional FAR post-construction as illegal and subject to demolition. This practice, previously common in the National Capital Region (NCR), allowed developers in multi-storey buildings to acquire FAR in case of minor deviations from the approved layout map.

Under the earlier system, developers seeking additional FAR could approach the development authority during the inspection for a completion certificate. However, this often led to complaints from residents about violations and challenges in regularizing the extra built-up areas. Going forward, the new regulations dictate that additional construction will only be permissible with prior purchase of FAR.

Presently, the permissible FAR for plotted developments and group housing in the city is 1.5 FSI (Floor Space Index), and 2.5 on the outskirts, with rates at about 40% of the land value. Purchasable FAR was previously allowed only on 25% extra construction in the built-up area and 33% in open areas.

The revised guidelines aim to streamline the process by allowing realtors to purchase FAR only once, during the submission of the project map for approval. Any unauthorized extra construction identified during inspections will now be subject to demolition.

Additionally, the government has made changes to project renewal fees, enabling developers to pay only for the unfinished portion of a project after the stipulated five-year construction period and a subsequent three-year extension. This move is anticipated to benefit developers of several stalled real estate projects in Noida and Greater Noida.

According to the Ghaziabad Development Authority (GDA), realtors are typically granted five years to complete housing projects, with a three-year extension provided if needed. Under the previous rules, the development authority charged a renewal fee for the entire project if it remained unfinished. However, the new regulations stipulate that renewal fees will only apply to the unfinished portion of the project.

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