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Tips To Simplify Your Property Redevelopment Process

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Tips To Simplify Your Property Redevelopment Process

The current trend in Mumbai’s real estate industry is redevelopment. With the city corporation framing new policies on unsound and old buildings to rev up the redevelopment process in the city, a similar scenario is being seen in other metro cities that are pressed for space.

Not limited to only private developers, government undertakings like the Indian Railways has now stepped into the redevelopment game. The railways plan to open up its residential colonies spread across Mumbai for redevelopment via private builders, and leverage funds for its future projects.

From a residents point of view, redevelopment, if implemented with strict adherence to the laid rules and regulations, can help you gain a better and safe living space. Homeowners must consider a few things before opting for redevelopment.

 

1. Redevelopment: When Is It Required?

The recently revised Development Control Rules (DCR) allows the redevelopment of buildings that are 30-years-old. A residential or commercial property if fit for redevelopment when an architect declares it as ‘dilapidated’.

 

2. The Society’s Role

The redevelopment process can be initiated only when 75% of the homeowners in a society agree to the proposal. A society registration certificate, the building’s original plan, a sale deed, a copy of the resolution, an agreement and a title deed are the documents required for the process.

Additionally, an NA order, to prove that the area on which the society stands is not agricultural land, and a property card are essential.

 

3. Appointing A Legal Expert

A developer might not adhere to the pre-decided plan of a building. Some might either deny paying the rent or offer a smaller carpet area than promised earlier. The worst is when he/she may demolish a building and refuse to build another.

To avoid such scenarios, it is preferable for a society to appoint a lawyer while signing an agreement with the developer. This ensures that both the parties are bound by law and refutes possibilities of cheating or misleading.

 

4. How To Select A Builder?

To shortlist a developer, a society must consider his/her merit, reputation and past experience in executing redevelopment projects. A tendering process is the most relevant way to invite builders for the redevelopment opportunity.

 

5. When To Vacate Your Place

It is only after the developer receives the required approvals for redevelopment from the respective municipal authority and after the agreement has been registered, is when the society members should agree to vacate their houses.

 

6. Security Deposit And Bank Guarantee

A security deposit, equal to the construction cost of rebuilding the society, is transferred to the society by the builder, which is based on the new design.

Also, a developer should give a bank guarantee of a minimum of 20% of the project cost, which could come in handy in case timely completion of the project fails.

 

7. Alternative Accommodation And Cost Of Shifting

A builder is entitled to provide residents with an alternative accommodation to residents or should agree to pay their monthly rent (for which advance payments can be made.)

If residents are shifting far away from alternative spaces, they can demand the cost of shifting from the builder, which includes the cost incurred by residents to shift to the temporary house and back to the redeveloped building.

 

8. Transfer Of Development Rights

Society members must ensure that the developer purchases the TDR, the incentive-based program that allows extra built-up area, and only then vacate the flat.

A developer will be unable to offer the extra flat area once promised if the TDR rules change after you vacate your home.

 

9. Project Delays

Redevelopment requires around two years to complete, the maximum being three years. If it stretches beyond this time frame, the developer is ought to pay residents the extra rent due to the inconvenience caused by the delay.

In case of a fraudulent behaviour, the society can approach a court with the help of the previously appointed lawyer. Besides, the society agreement will be favourable to make a strong case.

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