Article Side

Online Article Directory!

Hello Guest! Login or Register to submit articles!

Short Term Lull in Premium FSI Allocation in Chennai Realty

By Vinay Jain Subscribe to RSS | June 20th 2012 | Views:
loading
 
  



Premium floor space index, when introduced by the Chennai Metropolitan Development Authority 3 years ago, was seen as a tool that might encourage vertical growth of town. FSI is that the ratio of land space to the built-up area.

Over these years, it's proved its potential to be a cash spinner for the builder community and therefore the regulatory board as well. Whereas builders have cashed in on the steep hike in market costs, the CMDA has generated further revenue of 520 crore through aggregation of premium charges for the extra FSI sanctioned.

Starting with a meagre six crore aggregation in 2009-10, the revenue from premium FSI charges shot up to one hundred sixty crore the subsequent year and scaled additional up to three hundred crore last monetary year. Within first two months of this year the CMDA has earned fifty crore through allocation of premium FSI.

The euphoria over premium FSI looks to have paused for now owing to the recent exponential hike. Because of the premium charges for the extra FSI is calculated primarily based on the rule of thumb values, it doesn't create economic sense to avail premium FSI when the rule of thumb prices are beyond the market value. Matters within the outskirts of Chennai where guideline values have gone up by even ten times, matters remains worse.

But, the first 2 months of this year have yielded smart revenue for the CMDA through sale of premium FSI as a result of most of these cases had got sanctions last monetary year. Hence, they need to pay the premium charges on the premise of earlier guideline values. A sizeable phase of individuals who apply for premium FSI are those constructing buildings for self use.They would still avail the power.

Going by the estimation of growth in costs of residential property in Chennai within the last 5 years, the lull could also be short-lived. The costs of residential property in Chennai worth index of the National Housing Bank shows that the apartment costs have shot up by thrice within the central business districts of the city since 2007. Even the backwater regions of town command an apartment worth of 7000 to 8000 per sq ft currently.

Meantime, the Directorate of City and Country coming up with the regulatory board for the remainder of the Tamil Nadu, is on the edge of presenting premium Floor Space Index. It has now become a basic requirement with the introduction of the development management rules for the DTCP last year.

As the metro rail chugs along a forty five km stretch across Chennai, it should open up a gold mine for the state government and supply the town a full new look.

The government chanced upon the monetary potential of the metro rail whereas examining a proposal from Chennai Metro Rail restricted to introduce extra floor space index at intervals five hundred metres of the metro corridor.

The proposal, that came up after the meeting CMRL committee that has been forwarded to the CMDA for commissioning an in depth study. We expect the report back to be prepared in 3 months.

The potential for revenue generation through selling area is staggering. CMDA sometimes offers FSI of 2.5 for high-rise buildings within the town. If it's increased by 1.5 FSI along the metro corridor, the state will generate a revenue of about Rs 2.5 lakh crore through residential property tax by adopting the yardstick of the prevailing premium FSI scheme. If Floor Space Income is increased by 3%, the revenue can go up to rupees four lakh crore. Bangalore metro corridor is additionally engaged on the next FSI model.

Vinay Jain - About Author:
PropTiger is an independent real estate advisor with a pan-India presence. We aspire to be your first port of call if you want to buy a property in Chennai.

Share on Facebook Tweet It Stumbleupon this post This post is delicious !

Article Source:
http://www.articleside.com/real-estate-articles/short-term-lull-in-premium-fsi-allocation-in-chennai-realty.htm

Related Real Estate Articles Subscribe to RSS

Investing in property is what sound investors suggest
Published by Sophia Milller on December 13th 2011 | Real Estate
South Africa is one of the most developed countries in the entire continent of Africa. Does this mea...
 
How Booking Back After Your property is Sold.
Published by Moazzam on May 5th 2012 | Real Estate
Sometimes it’s useful to sell your house before you actually want to move. This frequently happens...
 
Lease your property for commercial strata management
Published by Chris Whelan on January 25th 2012 | Real Estate
Everyone should follow some qualified process during leasing their commercial strata management prop...
 
Investment in Real Estate property in Gurgaon
Published by Pioneer Urban on June 18th 2012 | Real Estate
Real Estate these days has become one of the most dynamic areas of investing and buying. The real es...
 
Port Washington NY real estate turns up as hot property destination
Published by Jack Smith on June 15th 2012 | Real Estate
When it comes to property one question that comes in mind is that how much that thing worth to you. ...
 
Finding property and buying it becomes with help of Real Estate Agents
Published by Melbourne Realestate on June 28th 2012 | Real Estate
If anything is done by the profession that creates a great impact. Same is in the case of real estat...
 
How to choose a good property in Bangalore
Published by Andy Wagon on February 15th 2012 | Real Estate
If you currently want a property and were looking for, then there are many references that can be us...
 
Port Washington property a true place to gamble your money
Published by Jack Smith on July 17th 2012 | Real Estate
People are ready to gamble their money, but everybody wants to make good money from their investment...
 
Estate agents can help in investing in right property
Published by Margett Helms on May 5th 2012 | Real Estate
Estate agents play a key role in dealings of property. The majority of house sales in London are mad...
 
Tips on running a commercial property management firm
Published by Carolmoore on March 1st 2012 | Real Estate
Owning property can make you set for life. Considering the high prices of land, owning a piece can b...
 
Real Estate Agent can be a good Profit maker for your property
Published by Mayank Gandhi on February 28th 2012 | Real Estate
feedbackhere.com: We provide easy to find Real Estate Agent for consumers vendors to make searching ...
 
Locate a property in Kolkata of your Choice
Published by Simmie on November 30th 2011 | Real Estate
Looking for a property in Kolkata? Ever looked up a classified ads web portal in the property sectio...
 
Save your property through Landlords insurance
Published by Ashish Pandey on February 3rd 2012 | Finance
Having landlords insurance can be very advantageous for all the landlords and can protect the proper...
 
The contribution of property management companies of Dallas
Published by Nishaidhijames on August 10th 2012 | Real Estate
A city which is located on an area of 343 square miles with about 1,299,543 of population and also t...
 
Get a good office property in Gurgaon
Published by Atul Sharma on May 21st 2012 | Real Estate
The article is based on real estate property in Gurgaon. It talks about how you can get a good prope...
 
Why one should invest in property in Greece?
Published by Greekexchange on January 10th 2012 | Real Estate
Greece is one of the most beautiful places in the world; people from all over the world visit this c...
 
 
Choosing trustworthy property consultant is beneficial
Published by Deepti on May 4th 2012 | Real Estate
Mohali is a full-fledged market of real estate. It is major part of tricity though it has now a sepa...
 
Best price property for sale in Mumbai
Published by Andy Wagon on February 14th 2012 | Real Estate
Owning a home is more than one can indeed serve as an investment in the future, especially if house ...
 
HOA management- Capable providers for financial as well as property management
Published by Ema Sis on January 12th 2012 | Finance
HOA management companies shall be actual asset for communal administration amenities. They undertake...