The proposal to hike the FSI for satellite cities is being perceived as a favourable move for the ‘affordable housing' agenda. We have the details...
When the government of India spoke about the need to create affordable housing stock in urban India, all eyes were on tier-II and III cities and rightly so! The sheer land cost has been so astronomically high in the metros like Mumbai that any fancy idea of creating mass housing in the city would have been cynical.
Does this mean that the contribution of Mumbai in creating affordable housing would be negligible? Not really! If only the Mumbai Metropolitan Region Development Authority (MMRDA) has its way, Mumbai with its expanding boundaries, can also contribute to the stock of affordable housing units. The MMRDA has proposed to hike the base Floor Space Index (FSI) in the MMR to 0.4-0.6 depending on the size of the plot from the current 0.2-0.4. The vision is to have more real estate development in Mumbai's satellite cities and towns.
The proposals are a part of the new ly framed draft region plan for the Mumbai Metropolitan Region (MMR) for 2016-2036. The MM RDA has invited suggestions and objections before finalising the fi nal version of the draft development plan.
MUMBAI'S REALITY:
Out of the 4,355 sq km spread area of the MMR that comprises of eight municipal corporations, nine municipal councils and more than 1,000 villages in Thane and Raigad districts, the MMRDA is eyeing the regions of Thane, Kalyan, Dombivali, Bhiwandi, Panvel, Pen and Uran, to grant extra FSI for affordable housing.
The MMRDA has also recommended a new `Station Area Development Scheme' promoting residential and commercial development close to the metro or suburban railway stations by granting a higher FSI of 1. The additional FSI is proposed at a premium of 30 per cent of the ready reckoner rates. The question is whether the move would be a tempting proposition for the developers or not.Well, if a report by the consultancy firm Cushman & Wakefield is to be believed, urban affordable housing offers a $12 billion opportunity to the private sector where the demand for homes in the MMR region is in the price range of Rs 50-70 0 lakh.
A GOOD MOVE:
Welcoming the move, Arvind Nandan, director South Asia with Colliers International, says it is ironical that the city with the highest density in the world has the lowest FSI norms. Calling it archaic, he says there is absolutely no other way now, as the city needs an affordable housing stock and the people are living in sewer pipes, roads and even those who have bought houses have not got what should be a fair share of the built space.In such a situation, where 60 per cent of your city (by land and by population), is occupied by slums, which are completely unauthorised and illegal, and one-third of the city is occupied by the mangroves and eco-friendly areas, what you have been left with is a very small part of the city that has habitable and developable land.
“I would rather say the thought should have been at its execution stage already by now and not just at the planning stage. You have to start building up to the possible capacity and at the same time, upgrade the infrastructure to feed that extra load. By having extra housing stock in the periphery areas, many other micro-markets would come up to share the pressure. Today, the biggest migration attraction is Mumbai and there is a need to grow both, horizontally and vertically,“
CHALLENGES GALORE:
Despite the additional FSI, the input cost of the project may not come down due to the proposed premiums and the increasing TDR rates. Moreover, FSI is just one of the steps to allow more living spaces but then, equally important are other aspects, which if not addressed, will pose a big constraint for creating affordable housing units.
For example, most of the suburbs have a cap on the permissible height due to the prevailing civil aviation norms and it is presently challenging to be able to consume the additional FSI with the current height norms. Sandeep Ahuja, CEO of Richa Realtors points out that the sector has to move beyond the debate over what is affordable since it is not a relative term. According to him, in a city like Mumbai, a vast majority of the people earns between Rs 2.5 and 3 lakh per annum and this is where the focus has to shift now there is enough housing demand in this set of buyers. “The basic focus should be to create mass housing stock and not just 200 or 300 apartments in the affordable segment.The role of the government is very critical here,“
OTHER SUGGESTIONS:
Some of the analysts hence suggest a TOD (Transit Oriented Development) kind of development along the extended Mumbai region to make sure that there is less load on the property market of main Mumbai. Vikram Kotnis, managing director, Amura Marketing Technologies points out that historically, TODs have been the driver of growth for big city suburbs where the demand is clearly reflected in the higher rentals and rates for properties closer to the tube and train stations, key highways, etc.
Commute and travel time hassles have been successfully addressed with the help of TODs in places like London, NY, Singapore and now it's time to implement it closer home in Mumbai. “Across big cities, people typically do not want to move five-six kms beyond the city's boundaries, especially where infrastructure is still catching up. In the case of Pune, we have seen great budget projects, which are under-performing, but there are projects at Hinjewadi that are doing phenomenally well, simply because the infrastructure and economic centre moved to the outskirts. Similarly in Mumbai, most working professionals will not travel from Badlapur to Fort,“.
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