Maha- CHS poised to by-passing the Real Estate Market

With 100% members consenting to go for re-development, housing societies in Mumbai Sub-urban district appear to be on firm track about bidding farewell to the redevelopers and pocket the huge gains of extra FSI. State Government’s assurance for an effective support to this attempt though belated, seems to be a well deserved booster.

The Saptarishi Housing Society in Borivali made a serious attempt about 3 years ago. “The builders were unwilling to proceed and the society’s condition was very dilapidated. We thought it made better sense to get a loan by mortgaging the property and go in for self-redevelopment”, says Ajay Dongare, Secretary of the Saptarishi Housing Society. “Reported Accommodation Times on 19 10 2015. http://mswanews.in/property-news-2/time-to-go-in-for-self-redevelopment/

Success stories of two sub-urban housing societies reported by TOI (9-1-2018) bring inspiring news to thousands of housing societies expected to be soon going to face redevelopment woes. A vivid account of self-help initiatives, in a daunting task of redevelopment of their properties Ajitkumar C H S  in Goregaon (E) and 12 member Chitra CHS in Chembur should trigger many such projects by  many more housing societies in Mumbai Metropolitan Region.

Exciting features of these stories reportedly are

  • Residents of Goregaon (E) Society are set to get 25% extra carpet area
  • Residents of Chembur Society are to get one additional flat after redevelopment besides a Rs 32 lakh corpus each.
  • As society members own the plot, ownership and development rights will stay with them even at the time of reconstruction.

Though the Mumbai District Central Cooperative Bank (Mumbai Bank) mooted a self redevelopment scheme for cooperative housing societies in 2015 so societies could acts as developers by appointing architects and contractors instead of looking for a builder, it is only now that the scheme, the brainchild of town planner Chandrashekhar Prabhu has got a push, with CM Devendra Fadnavis reportedly issuing directives to Mhada to extend planning and processing support for it. Experts believe 10,000 of Mumbai’s 40,000 societies could benefit, with the bank willing to extend a loan of up to Rs 50 crore for every project.

“Had we given the job to a developer, he would have sold the additional flats to earn profit and earned from development rights and ownership of land in the long run. Also, flat possession would have been at his mercy. These disadvantages have now been negated,” so said Mr.  Krushnakant Kadam, Secretary of Chitra C H S the report added.

Ajit Thakur, secretary of Ajitkumar CHS, said processing of project approvals has been fast, and so is construction, as the bank, as a government entity, has tied up with state agencies to expedite formalities. The bank has third-party experts to scrutinize project proposals before giving loans.

“A society can appoint a consultant to prepare a plan. Premiums to be paid to BMC/Mhada, shifting and other costs are being taken care of by the bank. The scheme’s only limitations are that all society residents need to unanimously pass the proposal and make repayments in 7 years,” said an expert. It is a manageable call housing societies adhering to strict discipline and whole hearted cooperation among members. No Loan waivers- is a red alert.

Reportedly CM Fadnavis has assured that the government will make matters easy for societies by bringing all authorities under a single-window system. “All permissions will be brought under one roof to ensure people do not have to run from one government office to another,” he was speaking at an event organized by Mumbai Bank a few weeks ago.The CM said the state will appoint Mhada as planning agency. He said some developers had reduced Mumbaikars to being ‘dhobi ka kutta, na ghar ka na ghat ka,’ and his government was looking to change this. Kudos to the MAHA-CM.  It was also pointed out by some speakers all society members would get benefits in terms of space and finances, it should be easy to repay loans. “More space means families will stay closer and together without having to buy flats far away,” they added. The Challenge is bound to instill much higher sense of cooperation amongst members.

TIMES’ expressed hopes that the corruption of various agencies, officials and netas does not pose a hindrance, which should induce more and more societies to taking self-redevelopment up. Let Mumbai be the pioneer once again.

Builders and developers are already under serious watch of the State Government especially after Maharashtra Real Estate Regulatory Authority (Maha-R e r a) has started cracking on erring builders, giving a very sympathetic well deserved ears to the woes of the flat purchasers.

THE REAL ESTATE (REGULATION AND DEVELOPMENT) ACT, 2016 (R E R A 2016) the chief objective of which is “to protect the interest of consumers in the real estate sector and to establish an adjudicating mechanism for speedy dispute redressal” and  its Section 2(s) takes in its fold “redevelopment”  This implies registration of self redevelopment projects and  the objective as aforesaid will also apply to housing societies going for Self  Redevelopment.

While launching a redevelopment project on their own, the Management Committees are well advised to have a serious look at the registered bye-laws (which may have been registered decades ago) and realign them not only with provisions of the M C S Act 1960, the M C R 1961 and The Maharashtra Co-operative Societies (Election to Committee) Rules, 2014, but also keep in mind the State Legislature has announced inserting special exclusive provisions for housing societies in the whole gamut of the “MAHA Coop-Societies Regulations” which presently cover 30 odd classes of cooperative societies. More on making and remaking bye-laws some later…

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