Important things to be consider while choose for Self-Redevelopment project mode
Step by Step we will understand key points here, please read completely,
In Mumbai, self-redevelopment is an increasingly popular route for housing societies to redevelop their buildings rather than engage with private developers. Self-redevelopment allows the society to have greater control over the process and potentially reap more financial benefits. The legal framework for self-redevelopment is primarily guided by Maharashtra Cooperative Societies Act, 1960, and certain guidelines issued by authorities such as the Maharashtra Real Estate Regulatory Authority (MahaRERA) and the Mumbai District Co-operative Housing Federation.
Key Legal Framework for Self-Redevelopment in Mumbai:
- The Government of Maharashtra’s Circular dated September 13, 2019, specifically facilitates and enables self-redevelopment of housing societies in Mumbai and Maharashtra. The circular provides guidelines for housing societies to undertake self-redevelopment, including the provision of easier access to loans from cooperative banks and the benefit of additional Floor Space Index (FSI) under the Development Control Regulations (DCR).
- Maharashtra Cooperative Societies Act, 1960:
This is the primary act governing cooperative housing societies. It lays down procedures for society management and members’ responsibilities. - Development Control Regulations (DCR):
These are regulations laid down by the Municipal Corporation of Greater Mumbai (MCGM) which govern the manner in which redevelopment can take place in the city, including aspects like floor space index (FSI), setbacks, and building height. - MahaRERA (Maharashtra Real Estate Regulatory Authority):
MahaRERA ensures transparency and accountability in real estate transactions, including those related to redevelopment. Any redevelopment project has to be registered under MahaRERA. - Special Directives of Government of Maharashtra:
The government has issued guidelines and circulars to make self-redevelopment easier, including allowing additional FSI and various concessions. - Municipal Approvals:
Any redevelopment, whether by a builder or by the society itself, needs to adhere to the regulations laid out by the Municipal Corporation of Greater Mumbai (MCGM).
Steps to Carry Out Self-Redevelopment:
- Resolution by the Society:
- The society must first call a Special General Body Meeting (SGM) to discuss the idea of self-redevelopment.
- At least 70% of the members must agree to self-redevelopment for the process to move forward.
- A resolution should be passed to appoint a project management consultant and other professionals to begin the process.
2. Feasibility Study:
- The society should hire a project management consultant (PMC) or architect to conduct a feasibility study to understand the technical and financial viability of the project.
- This study includes analysis of the society’s current FSI, the potential increase in FSI under current regulations, the cost of the project, and the potential profits.
3. Project Funding:
- For self-redevelopment, societies often obtain financing from cooperative banks.
- The Maharashtra government has instructed cooperative banks to offer loans for self-redevelopment under certain schemes, like 95% of the project cost being financed.
- Societies must open a separate bank account for managing the redevelopment funds transparently.
4. Appointment of Project Management Team:
- The society should appoint a project management consultant (PMC), architect, legal adviser, and other required professionals to assist with the redevelopment.
- The PMC will oversee the entire redevelopment process, from designing the new building, getting approvals, to monitoring construction.
5. Approval from Municipal Authorities:
- The society needs to submit the redevelopment proposal to the Municipal Corporation of Greater Mumbai (MCGM) for approval.
- This includes getting approval for FSI, development plans, and other regulatory compliances as per the Development Control Regulations (DCR).
6. MahaRERA Registration:
- The redevelopment project must be registered with the Maharashtra Real Estate Regulatory Authority (MahaRERA).
- MahaRERA registration ensures transparency and helps protect the rights of flat purchasers and society members.
7. Commencement of Work:
- Once approvals are in place, the society can commence construction, either by hiring a contractor or developer on a contract basis.
- The society should supervise the project through the PMC to ensure it is on schedule and within the budget.
8. Sale of Additional Flats:
- In most cases, the FSI (Floor Space Index) is higher for redevelopment, allowing for the construction of extra flats.
- The society can sell these additional flats to generate revenue for the redevelopment costs or distribute these among members as per the scheme decided.
9. Rehousing of Members:
- During the construction phase, members must vacate the premises.
- The society usually arranges for alternate accommodation (either by giving rent or transit homes) as per the approved agreement.
10. Completion and Occupation Certificate:
- After the construction is completed, the society must obtain an Occupation Certificate (OC) from MCGM, indicating the building is safe for occupation.
- Members can then take possession of their new flats.
11. Transfer of Title and Handing Over Possession:
- After obtaining the Occupation Certificate, the new units are allotted to the members according to the agreed plan, and title deeds are transferred as per the new plan.
