REAL ESTATE UPDATE
16th May 2023
Issue No. 02/23-24
THE LAST PUSH FOR IMPLEMENTING THE SELF-REDEVELOPMENT POLICY
BACKGROUND
The Government Resolution dated 11th September 2019 (‘‘2019 Resolution”) which was introduced by the State Government of Maharashtra to facilitate the self-redevelopment of housing societies and to put stalled real estate projects on track, has till date not been implemented. The 2019 Government Resolution remains only on paper, thus causing a lot of ambiguity and confusion among societies which intend to go under self-redevelopment by availing the benefits stated in the 2019 Resolution. The said 2019 Resolution can be accessed here.
Since the year 2019, there have been various failed attempts to implement the scheme of self-redevelopment of the housing societies due to the factors like COVID-19 and the subsequent change in the government.
A statement was also issued in October 2022, by the Deputy Chief Minister of the State stating that that the Maharashtra Government is planning to start and set up a single window system for obtaining various clearances for housing projects which are going for self- redevelopment. For further information on this please refer to our previous update dated 7th October 2022.
CURRENT STATUS
The Deputy Chief Minister, Devendra Fadnavis, who is also the Housing Minister of the State has directed the state administration to fast-track implementation of the self-redevelopment policy. It is proposed that a dedicated cell will be formed which would allow the applicants to file applications and the same would be processed within a period of three months. Further it was also discussed that efforts will be made by the Co-operative Department to involve banks to provide financial assistance for self-redevelopment.
To facilitate development and for providing of finance to individuals for the purpose of Housing and/or redevelopment, several circulars have also been issued by the Reserve Bank of India, consolidated as Master Circular dated 1st April 2022. The said Master Circular can be accessed here. Further, Master Guidelines dated 17th February 2021 has been issued to Non-Banking Financial Company for the purpose of providing loans to co-operative societies for the purpose of purchase/construction/reconstruction/renovation/ repairs of residential dwelling units. The said Master Direction can be accessed here.
It is reported that it was also discussed in the last meeting on the subject, that the finance department shall prepare and come up with a proposal regarding the provision of GST rebate and interest rebate for self-redevelopment.
Lastly, the Maharashtra State government is expected to come up with a policy for stalled real estate projects and to ease the worries of the residents of dilapidated buildings. This will be of great significance to the societies, where they are not left at the mercy of the developers or to the residents who have been rendered homeless due to projects languishing at various stages of incompletion. This move has also been appreciated by the President of NAREDCO Maharashtra, an apex body of real estate developers who has commented that, “Stalled redevelopment projects have become a bane for so many residents of Mumbai. These residents are deprived of the necessity of shelter. They have to make ends meet to support themselves and their families amidst the rent payout, bank EMIs, etc. This is a great initiative taken by the chief minister, and we at NAREDCO Maharashtra are looking forward to working together in finding a quick and lasting solution.”
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