The selling prices of residential flats and villas have almost doubled in the last five years owing to multiple factors.
The skyrocketing land prices is seen as a major contributor for the soaring market rates of dwelling units. In Kerala, the sq-ft rate of residential apartments is estimated to be Rs.500 to 1,000 more than that in other Indian cities in similar category, says S. Krishna Kumar, president of CREDAI and Managing Director of Nikunjam Constructions.
He says that the high land prices are not at all justified and it just exploits the increased demand and apparent exhaustion of large plots for multi-storied flats or villas.
It is estimated that hundreds of acres of land are still available in various villages around Thiruvananthapuram city, such as Attipra, Cheruvaykkal, and Akkulam, to name a few, which are either landlocked or accessible only through very narrow roads, says Mr. Krishna Kumar.
Bringing down costSimilar land is to be identified, pooled, designed, and given sufficient road access in all districts and land prices can be brought down to half, resulting in a much lower selling rates of flats.
The government can reassign itself as a facilitator of the development of these landlocked belts by acquiring the necessary land for providing infrastructure like wider roads, water, drainage, and electricity and other civic essentials such as educational institutions, hospitals, markets etc. More people would move to newly developed localities, easing the city’s current pressure on living space, traffic, drainage, and water.
The owners of landlocked properties that are to be acquired may not be compensated in cash, which usually keeps the acquisition procedure in impasse for years, as seen in many of the city’s trailing development projects, but be entitled with Transferable Development Rights (TDR).
Many developing States such as Maharashtra and Karnataka have leaped ahead in development through the TDR route, where governments do not have to spend from their coffers and provides a win-win situation to all stakeholders.
Speedy acquisitionTDR is a mechanism to facilitate the speedy acquisition of land for developing infrastructure such as city road development, satellite towns, and metro rail.
Under the TDR route, the government acquires land from the landowner in exchange for development rights that are transferred to the landowner. Such ‘development rights,’ issued as Development Rights Certificate (DRC), empowers the owner to go for extra floor area ratio (FAR), which shall be fixed by the government.
FAR is the ratio of the total floor area of a building in a certain location, to the size of the land it occupies and the permissible floor area which can be built is restricted at this prescribed ratio.
TDR allows the developers to exceed the mandatory FAR and allow them to build additional floors in a building. The greatest advantage of TDR is its flexibility in use — it can either be used by the landowner on the remaining portion of the land after the acquisition or be utilised on any other property of personal choice. It can also be traded to other parties for an agreed sum of money.
The TDR scheme is found to have effectively addressed the long, complicated, and costly process of land acquisition in urban areas for public purpose.
Mumbai was the first city in India to introduce TDR in 1991, finding its success in the city of New York.
The government could mandate the implementation of TDR in places of its choice depending on its priority for development. Various types of TDRs can be designed such as slum TDR; amenities TDR, low-cost housing TDR, and heritage TDR, to list a few.
The government need not spend anything for any of these development activities but has to issue DRCs to builders and developers, who could be engaged in the development of roads, slums, and social amenities.
Though highly innovative, extra caution has to be put in before implementing TDR. All the records of rights generation, beneficiaries, transfer, and utilisation of rights should be kept intact as it poses a good chance for discrepancies and unrestricted and unauthorised constructions under the behest of ‘rights.’ People may be imparted with good knowledge about the advantages, procedures, and effective usage of TDRs as novices may be hoodwinked.
With the huge expense involved in land acquisition for the Light Metro project in Thiruvananthapuram and Kozhikode looming large, the TDR scheme may be the right solution for the State government to save both time and cost.
