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Deen Dayal Jan Awas Yojna (DDJAY) plotted housing scheme suspended in Gurugram & Faridabad

Affordable plotted housing scheme suspended in Gurugram & Faridabad over high land cost

More than six years on, chief minister Manohar Lal Khattar ordered the suspension of the scheme in the two neighbouring cities, during a recent meeting with senior officials of the department of town and country planning (DTCP).

GURUGRAM: The state government has put on hold its ambitious affordable plotted housing scheme — Deen Dayal Jan Awas Yojna (DDJAY) — in Gurgaon and Faridabad, citing high cost of land and its failure to benefit the lower- and middle- income families, TOI has learnt.

Prime Minister Narendra Modi launched DDJAY in the state in November 2016, with an aim to put a check on the development of unauthorised colonies apart from providing affordable housing units to the lower- and middle-income families.

More than six years on, chief minister Manohar Lal Khattar ordered the suspension of the scheme in the two neighbouring cities, during a recent meeting with senior officials of the department of town and country planning (DTCP).

In the meeting, sources said, Khattar expressed his concern over the high prices of these affordable units in Gurgaon and Faridabad. He told the officials concerned that the key objective of the policy was to provide affordable homes to the people but the high cost of land in these cities had defeated the entire purpose of DDJAY.

According to DTCP data, around 60 licences were issued under DDJAY in Gurgaon and adjoining areas for developing housing units across 600 acres of land and around 40 licences for 400 acres of land in Faridabad since the launch of the scheme. Around 60 licences are currently under process in these two cities for the same scheme.

Confirming the development, a senior official of DTCP said that due to the high cost of land in Gurgaon and Faridabad, the affordable plotted housing scheme “has turned unaffordable for the homebuyers of the said segment”. “So, the scheme has been put on hold in the two cities.”

A city-based real estate expert said that apart from the cost of land, another loophole in the policy is the absence of a cap on the rates unlike highrise affordable projects, where the per square feet rate is fixed by the state government.

Even the developers are helpless as they purchase the land at high cost and so the project is sold at higher cost keeping margins,” he said.

Developers also said that the affordable plotted housing scheme in Gurgaon and Faridabad is unsuccessful due to the high cost of land. “DDJAY is more beneficial for realtors as the profit margins are high as compared to highrise affordable housing projects,” said a developer.

“Also highrise projects require construction cost, which is not the case in the plotted housing scheme. But then the plots are costing in crores unlike the fixed price of affordable flats which are under Rs 26 lakh, thus making them unaffordable for the common man.”

In August last year, the state government, in order to promote the scheme, announced that the developers who had launched projects under DDJAY would no longer be required to freeze 50% of the plots. They would just require to mortgage only 10% of the project land to the DTCP as security for external or internal development charges.

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Developers Focus on Low-Rise Development in Gurgaon, Faridabad

Gurgaon and Faridabad will see an investment of nearly Rs 7,000 crore in construction of independent floors as many developers plan to focus on low-rise buildings following the launch of a government scheme.

Developers including DLF, M3M, Birla Estates, BPTP, Trehan Group and ILC group have applied for the licence under the Haryana government’s Deen Dayal Jan Awas Yojna (DDJAY), which allows developers to construct up to four floors and sell them independently.

“Gurgaon has always focused on luxury housing, with nothing much to offer to people looking for below Rs 2 crore property. With about 20,000 independent floors on offer in next one year by these developers, Gurgaon will offer properties in mid-segment also, as these independent floors will be available in the range of Rs 50 lakh to Rs 1.75 crore,” said Anckur Srivasttava, chairman, GenReal Property Advisers.

Developers say high-rises take five-seven years to monetise and that amid the ongoing liquidity crisis, the real estate sector is looking for quick monetisation of assets.

“However, developers need to be careful as there could be an oversupply. It will not be a cakewalk and the developer has to target the right buyer. In Gurgaon, people were unable to take the credit link subsidy scheme, so developers offering a floor within Rs 45 lakh will attract buyers,” said Srivasttava.

DLF, the country’s largest real estate developer, had said in its quarterly that it planned low-rise developments including independent floors and plotted developments in some parts of Gurgaon.

Of the total upcoming planned development, 44% will be plotted and low-rise.

“We have planned independent floors at three locations in Gurgaon and Faridabad with an investment of Rs 500 crore,” said Amit Raj Jain, senior vice president, BPTP.

Real estate developer M3M plans to invest Rs 4,000 crore in developing 10,000 units in various locations in Rs 60 lakh-1.75 crore price range.

Trehan Group plans to invest Rs 150 crore in developing 1,000 units.

“For a developer, monetising high-rises takes a lot of time and effort. With the attractive scheme of Haryana government, where it offers rebates in developing independent floors, it makes sense to go for low-rise development,” said Abhishek Trehan, executive director, Trehan Group.

Experts said the government scheme and multiple builders offering competitive priced flats would help curb unauthorised construction too.

“In the next two years, independent floors will dominate the real estate market and developers will keep on offering better projects and amenities to lure the customers, keeping in mind the need and desire of the end users,” said Ashish Thapar, managing director, T and T Realty Services.

According to property consultants, independent floors will account for 75% of the total launches in Gurgaon, while it used to account for less than 10% earlier.

Some developers are even converting the group housing licence to DDJAY.

“We have applied for licence change after seeing the demand for floors. We have planned a township of plotted developments and are acquiring more land. We plan to invest Rs 100 crore in the construction of 600 units,” said Rehan Huck, vice president – retail, ILC Group.

Source :https;//economictimes.indiatimes,com/