With one eye on polls, Delhi govt plans new housing norms

One has heard plenty on the high property prices in New Delhi, due to a shortage in housing. However, now ahead of the state elections this November, the Delhi Government has finally decided to do something about this, reports CNBC-TV18's Nayantara Rai.

The state-owned Delhi development authority (DDA), will shortly come out with a new policy. It will be doubling the permissible built-up area for new group housing projects. Officials in the DDA and Delhi Government told CNBC-TV18 these new buildings will be taller, perhaps beyond 12 floors. This will be achieved by hiking The floor area ratio (FAR) from 200 to 400, as for commercial real estate, the proposal is to hike the FAR by 66 percent to 250. These changes will not be for all of Delhi, but pockets of new urban areas being planned by the DDA including new urban extensions beyond Rohini in West Delhi, ahead of Dwarka near the airport, and even the Chattarpur area which is associated with Delhi's sprawling farmhouses. Taller buildings may also be permitted within 500 meter of Delhi's metro corridor. Also read: Expect target of Rs 145 on IRB Infrastructure: Joshi According to Anshuman Magazine, CMD, CBRE, it seems like the Government would increase FAR, allow more and it won't be square feet. "It will be really what is the total construction allowed in a land and it will not be across the city. It will be in some pockets. However, there is talk about that across the city they may allow for example one more floor for residential house. So, it will be a mixed bag", he says. However, for all of this, new land will be needed. It has finally dawned on the Delhi administration that it needs to put in place the new land acquisition norms. This is to successfully expand the national capital. So, a new land pooling policy is on the anvil, and the real estate development will be led by private players. The state will allow farmers and landowners to pool in their land. The private developer will come up with a master plan for this land. It will be a master plan that will need the DDA's approval and to provide incentives for land pooling. The original land owners will get back an equitable portion of the developed group housing, office space etc. The Delhi Government will also do away with the cumbersome process of changing land use from agricultural to residential. Magazine feels that the only way to bring the prices to competitive level is by increasing supply. "However, infrastructure has to be looked at because if it is done blindly this will cause more problems to the city", he adds. On the other hand Shveta Jain, ED - Residential Services Cushman & Wakefield India says, "I don't really see a negative impact on pricing because there is a lot of pent-up demand".Before finalizing the new land pool policy, the DDA plans to invite public comments.