To push cluster redevelopment in the city, the state cabinet on Tuesday approved to reduce the premium by 50%.
Deputy CM Devendra Fadnavis, who also holds the housing portfolio, said the decision to reduce premium is applicable only for a year. “This is to ensure that people come forward quickly with projects for approval. If it is open-ended, then it takes a long time,” he said. “This has been done to ensure Mumbaikars get an affordable home and do not have to go outside for a house. With reduction in premium and additional area, Mumbaikars will be able to get a home practically free in the city.”
Domnic Romell, president of CREDAI-MCHI, a housing industry representative body, said the decision discourages fragmented development of standalone buildings lacking proper infrastructure, while encouraging the adoption of cluster redevelopment. “Cluster redevelopment means wider roads, improved water supply, drainage system…it ensures the overall infrastructure upliftment of an area,” he said.
Launched in 2009 as part of an urban redevelopment scheme for south Mumbai and now extended to all of Mumbai, Navi Mumbai and Thane, cluster redevelopment has failed to take off. There are only a handful of such projects in the city, the most prominent being the 16-acre Bhendi Bazaar cluster redevelopment project.
Sandip Isore, consultant to the real estate industry, said premiums for all construction projects are on the higher side. “Many developers are reluctant to take up cluster redevelopment as they are financially non-viable. This decision will help developers to come forward as it will offer better viability,” he said. “The BMC must also ensure speedy approvals and most importantly, the government must send out a message to the people who are the most constituent of this project to build their confidence so that they give their consent.”