Chapter 2.

Literature Review

2.1 Urbanization – A Process of Transition of Urban Areas

Urbanization is more than a demographic phenomenon. It is a societal transformation

along a rural-urban continuum. It is also concerned with ensuring that in every
developing country this transformation leads to a higher quality of life for all, and to
more sustainable national development. Urbanization is characterized and even defined
by fundamental changes in the physical concentration of population, in the nature and
scale of economic production, in land use, and in social structures and patterns of
interaction. The growth of cities and towns expands opportunity to all citizens, and the
urban built environment can enrich a nation’s cultural identity. In many countries, poorly
managed urbanization results intosignificant social and environmental loss.

The core problem of India’s urbanization lies in the fact that it has barely paid attention to
urban transformation so far. Urbanization has taken place in a largely unplanned fashion.
Urbanization in India reveal alarming facts evidences which exemplify the truth that
India must now wake up and take measured steps towards sustainable urban
development.

Changes in all of these dimensions affect the lives of individuals and the requirements for
resources and governance.

Densification of settlement directs land and wealth into housing and related infrastructure
and increases the need for complex systems to provide water and energy, market food,
transport goods and people, remove wastes, and protect public health and safety. Land
becomes more intensively developed, and the resulting spatial layout affects accessibility,
physical contacts among communities, interaction with the surrounding natural
environment (encompassing agricultural land at the urban periphery), and the costs of
fixed infrastructure networks.

The process and factors governing the transformation has been the major concern of
studies. The factors governing are more than the physical transformation which include

27
social, cultural, economic and political changes. Study pertaining to understanding
‘transformation’ begins with the study of process of change and what factors had been
changed. In order to comprehensively analyze the factors that have conditioned and
influenced process of housing transformations, a study of urban housing of a rapidly
developing city is essential. A growing, historical metropolitan city presents an
opportunity to study the housing changes over a wider temporal and spatial canvas.
(Cities in Transition - World Bank Urban and Local Government Strategy)

Urbanization is broadly defined as a growth of towns and increasing ratio of urban to

rural population of a country. This results in pressure on the cities. Fringe areas and
nearby villages start to merge and become part of the city due to the process of
suburbanization. Descent land and housing have become expensive for the urban poor.
Inadequate urban planning, poor management and a series of inefficient land regulations
have been pointed out as factors responsible for massive housing issues in mega cities.

2.2 The Challenges of India’s Urban Transformation

Since independence, most towns and cities rely on inflexible master plans which are more
often outdated by the time they are implemented. Rigid development control norms
which are flouted at every step and a weak governance system which can neither guide
nor enforced, completes the picture of bad state of housing. Recent policy innovations
such as the National Urban Renewalmission presented using a wide range of illustrations
and examples is a good initiative.

The challenges of urban housing, especially for low-income populations, infrastructure

provisions and delivery of urban services are main critical factors in many Indian
growing cities. In terms of infrastructure and services Indian cities lag behind on almost
all counts. Poor urban planning framework and ineffective local governance are key
factors of challenges faced by Indian cities today.

While dealing with the process of urban transformations these all key factors need to be
addressed to form a proper policy framework and urban planning guidelines for making
the cities sustainable. Our cities have grown in an unplanned and haphazard manner due
to rapid urbanization and lack of planning. Cities are overcrowded because of natural

28
population growth and migration of countryside population to industrialized cities in
search for employment opportunities. This has put pressure on the natural resources of
cities; hence, more consistent efforts have to be made to replenish resources so that
people can meet basic standards of living. In absence of habitation, the poor are driven by
necessity to live on footpaths or in slums having unhygienic sanitary conditions. The
pressure of increasing population has led to construction of sky-scrapers to accommodate
maximum number of people within minimum space. This has created other issues such as
fire hazard, lack of civic amenities such as parks, open spaces and playgrounds.

The urban housing shortage is closely linked to the creation of slums in each major
metropolitan city in India, which is detrimental for the urbanization agenda.(Making
Indian cities livable: the challenges of India’s urban transformation)

2.3 Hybridization

Urban hybridization phenomenon is an integral part of contemporary society growth

dynamics, building typologies and spatial organization. In all the Indian cities, along with
the globalization sub urban areas are rapidly developing. The urban living is largely
influenced by the globalization, due to that social changes, adverse environmental effect,
and demand of premium lifestyle extensively seen in growing metropolitan areas.

The hybrid fragmented developing or developed city structure impacts on environmental,

physical, social and an economic factor of the city. Urban hybridization produces new
typologies and spatial configurations in a city which are result of change in physical,
economic and political aspects.

In search of new areas for housing developments mainly areas are growing around the
main city up to the mountain skirts near to city. This development is coming up in
different spatial patterns and fragmented planned patches. New form of residential
developments is gated communities, private, high rise condominiums. With a new
question arising that are these developments continuing to develop exclusive private
spaces and resulting in loss of public interactive spaces as well as environmental assets to
larger extent.

29
Urban hybridization is becoming integral part of contemporary society growth dynamics
and spatial organization due to globalization. Considering the example of Pune city, an
attention is requiredfor newly generating cosmopolitan urban context and transcultural
spaces. To overcome the negative aspects of the hybridization process strong policy
framework is to be framed out.(Petkar 2013)

2.4 Urbanisation and Housing Transformations

Along with the rapid pace of globalization cities are changing their fabric. Similarly,
housing sector is also changing its character. Old individual housing subsystems are
changing to group housing. Gated communities are resulting in the housing with less
social communication spaces. New busy lifestyle, growing percentage of nuclear families
is a result of globalization and has a major impact on new development scenario.

Housing transformation is one of the major impacts of all forms of urbanisation. It

happens in all sectors of the society. Along with the richer class, urban poor sector also
goes through this process of transformation.

Housing transformation has been attributed to three major factors: restrictive or

inappropriate state policies, rapid urbanisation and failures in the formal housing delivery
systems.

Transformation can be assessed on several grounds. First, it is viewed as a solution

adopted by people themselves in circumstances where no other solutions were offered.
Second, sharing of infrastructure and services reduces housing costs and third, rental
housing can become a regular income generating option for landlords and also affordable
housing solution to low income households.

With changing communication technology, the traditional living spaces need to be

redefined with the changing forms and functions. Houses are changed as people are
becoming physically and socially more integrated with the outside world. With growing
urban spaces, new housing developments are less influenced by existing traditions and
more influenced by new trends and communication patterns. Spatial pattern of various
housing types not only illustrate different domestic experiences but also identify the
impact of physical transformation by the process of urbanisation.(Faustin, 2014)

30
Because the process of urbanisation affects traditional culture, the impact of these
changes becomes physically evident, particularly in most of the growing metro cities. In
general, the house styles and arrangements have developed across time in order to
accommodate new requirements based on the change of lifestyle and attitudes. House
style design and spatial arrangement influence alterations, which consequently affect the
interactions among occupants and their daily routines.
Considering the migration rate in the Pune City, rental housing percentage is
considerable. It can give traditional landlords a sustainable source of income. It is an
effective mechanism to generate formal housing supply within the city limits. It will
directly or indirectly make impact on demand of land for housing. Instead of generating
new vacant housing stock, existing housing tenements will be used effectively and
burden on infrastructure facilities will also get reduced. The design of houses is a direct
expression of changing values, images, perceptions and ways of life. Physical
transformation of living spaces as a way to define the connection and the understanding
of the relations between built spaces and culture.
The investigation of evolution of domestic space by tracing the development of spatial
pattern over time indicates culturally linked phenomena among the housing patterns and
helps to identify the problems of consistency and transformation of pattern.
The high demand of land and smaller family size has given way to the urban residential
areas to go from neighbourhood community to the concept of small housing society.
These housing societies are a concept outfall to share the limited land parcel to build
multiple dwelling units building under the corporative cooperation system. This in turn
forms a society to jointly take the ownership of the land and the building facility. The
transition from family house to apartment society has made its way to the adaption of
urban land value and adding smaller units to one building jointly owned by a number of
families together. Traditional family courtyard houses have been replaced by the
condominium buildings with spared amenity spaces.
Changes in living spaces and its changing factors from traditional houses to present
developer’s housing is a process of housing transformations. Various factors need to be
studied which are influencing on the space needs and new forms of housing which are

31
emerging as a changing urban fabric. The shift in the division of the space distribution of
a building is emerging to its new identity. The transformation brings more focus on the
qualities of the house, especially in size, form and the relationship of a house to its
surrounding outdoor space. Individual’s expectations of improved housing seem to pose a
challenge to the whole idea of housing transformations. It is assumed that the
developmental factors in house design are the impetus to continued housing
transformation process.
(Niger,2012)

Understanding that housing transformations is one of the mechanisms of intervention by

people themselves in housing development is realized, through house alterations like
extension, alteration, demolition and replacement by better and durable houses.
Theproblems emerging from this process include: reduction in outdoor space and
increase in housing density. Analysis of issues like space use and spatial qualities,
separation of functions, privacy, health and comfort is required.(Huba,2003)

In Indian cities, over the years, transformations in urban areas have taken place in varied
forms, including those of form, land use, encroachments, and heights, floor area coverage
etc. There is a large scale transformation occurring in the city both in terms of land use as
well as use of premises. The socio-economic factors are primarily responsible for this
transformation. The transformations are occurring in terms of housing form and also in
terms of unauthorised extensions to houses, use of premises, quiet often with the
violation of legal framework. The cause of these types of transformations is coupled with
failure in planning, developing and poor implementation of development plans.

2.4.1 Transitions in residential Neighbourhoods

The rising land costs are making the construction of reasonably priced. Local and
Planning Authorities are encouraging to transition to commercial retail establishments or
higher-density residential uses that supports the need to supply housing apartments by
designating streets and areas. Many streets in residential areas have altered into
commercial, public and semi-public activity and apartments. Transition of land uses is
inevitable in large cities. Thus, the residential areas are affected greatly in terms of

32
increasing density and overloading the existing infrastructure facilities by changing
dynamics of land use. With a result of this, the residential areas are transforming into
mixed land use which is the scenario in most of the core city areas in India.

Core areas of the city are getting their face more commercial and residential community
developments are up-coming in the sub urban areas of the city.
(B. Shankar,)

2.4.2 Urban Fringe Development

Urbanisation involves outward expansion of large metropolitan area and cities. Most of
the large metropolitan cities in India have continued to expand laterally and are better
described by census term urban “agglomeration”. Large metros mostly show declining
growth in the core and continue to expand outwards but this expansion comes at the cost
of engulfing many villages and smaller towns in the surrounding area. The lateral spread
of the city can be captured by the growth in the urban population due to the merging of
towns and by jurisdictional changes in the urban agglomerations. Spreading of
urbanization reveals negative effects on peri-urban areas such as land use changes from
agriculture to residential/ industrial, commercial etc.(http://theinclusive.org/urban
villages in globalized India degenerative growth processes in Navi-Mumbai)

With the development of the newer areas, the architectural style of the buildings also
changed. There is no similarity in the elevation quality of the old houses, thus streetscape
of the city became chaotic, resulting in the transition of Kasbe to Peths, merging of
surrounding villages and emergence of a new urban form. Finally, due to the rapid
growth of industries and subsequent increase in slum population, Pune achieved its
present form.

The fringe area of Pune developed because of reasons like functional transformation of
the city and related increase in population. From as educational and cultural centre the
city gradually became a centre of large scale manufacturing industries. In just couple of
decades after independence, Pune urban agglomeration became the city with second
highest industrial complexes of the state attracting migrants from all parts of the country.
The city become a trendsetter of new ideas and adopted more modern ways of living.
Another important event in the history of Pune was the bursting of the Panshet dam in the

33
year 1961. The local authority contributed to the development of the fringe area in the
form of housing for the flood affected victims. The individuals wanting to move out of
the congested noisy city core, away from the joint family system, started buying plots for
housing in outlyingareas. (Joshi Ashutosh, Town Planning- Regeneration of Cities)

2.5 Affordable Housing Crisis

Housing affordability has become a key issue in many metropolitan cities. A major
percentage of the society cannot afford decent housing options due to high prices.
Unavailability of land, high constriction costs and many other factors are responsible for
the affordable housing crisis. Buyers have to go away from the main city for good
housing solutions. In India, housing affordable housing has been the exclusive preserve
of public sector undertakings such as Housing Boards or Development Authorities.
Private sector, real estate developers have been historically precluded from affordable
housing both structurally and at the level of policy. Developing affordable housing in
Indian cities faces significant challenges due to several economic, regulatory and urban
issues. Whilst the lack of availability of urban land, rising construction costs and
regulatory issues are supply-side constraints, lack of access to home finance is a serious
demand-side constraint, which impacts the ability of low-income groups to buy housing.
Although some of these are gradually being mitigated, efforts are required by multiple
institutions to facilitate mass development in this sector.

Some of the major factors responsible for making housing a dream of common man are:

▪ Land cost in urban city centers are high, often constituting more than 50% of
the project cost for developers; this makes affordable housing projects less
feasible.
▪ Building affordable housing entails buying raw material at a cheaper cost so
that the benefit can be passed on to the end-user or homebuyer. Land is the
most important raw material for real estate developers. In order to build
affordable homes, land can mainly be purchased in peripheral areas of the city
since cost in city centers is high. But peripheral areas of the city lack

34
 infrastructure facilities such as good connectivity to city centers, water supply
and sanitation.
▪ Typically, in India, the process of acquiring necessary construction approvals
for each project takes anywhere between 18-24 months. Such a long holding
period leads to additional cost escalation for developers.
▪ People who belong to LIG and EWS segment have little access to organized
finance. These people often do not have documents such as proof of address,
salary slips, etc. The housing finance industry is hence not geared towards
providing finance to those who need it the most.
▪ There is lack of sound government policies that enable and incentivize the
affordable housing segment such that developers are geared to build
affordable housing projects.
(Wakefield, Cushman, 2014)

2.6 Need of Policy Framework and Guidelines

Worldwide the role of government is being reconsidered and reconfirmed to strengthen

its essential functions of facilitating markets and correcting market failures, promoting
economic and social stability, and ensuring distributional equity. Certain issues such as
high degree of control on land market, lock-up of land parcels by government agencies,
insufficient spatial planning and improper development of urban peripheries seems to
have led to artificial scarcity of developable urban land. The shortage of land may have
resulted in inflating land prices which affected the development of formal affordable
housing sector. Additionally, lack of formal rental housing market resulted in
development of slums across the state. Rental housing stock is an essential part of
housing in a city as it helps to accommodate new migrant population, temporary workers
or low income population, who are unable to or do not require a permanent house.

As public sector is not capable of taking role as a provider in real estate sector, it should
have a strong role as a facilitator. A strong regulatory framework and guidelines are
needed to be formed for increasing formal housing supply and also making it affordable
to major percentage of society. Today result of market oriented policies and rapid

35
urbanization have resulted in higher prices. Increased privatization of the housing market
has created inequalities and available capabilities in the people’s ability to purchase
houses based on their income groups. Low income groups which are largely composed of
floating population are unable to own necessary housing along with the provision of
amenities. This housing problem must be solved on priority basis.

Government has to come with strong policies to curtail rising house prices, as well as to
strengthen ability for more and more citizens to obtain bank loans, show the increasing
ability in the average citizen to fulfill their aspirations of obtaining a house despite the
high real estate prices.

In China, government made policies to curtail housing prices as well as to upgrade ability
of more and more people to own house. In India, the government of West Bengal has
taken important steps to not only meet demands in housing but also give access to the
poor for adequate housing as well, which ultimately resulted in positive housing
changefor lower income group.

2.6.1 Public private partnership

Last decade saw an emergence of a new wave of Public Private Partnerships (PPP) in the
urban housing sector in India. The concept of Public Private Partnerships (PPP) in India
has been widely recognized as a natural response to meet the colossal demand for
housing, government’s dwindling budgetary capacity, massive demand coming from a
section of the society for better quality of services and a need for a catalyst to boost
macro-economic conditions.

The Kolkata city has been in the forefront of housing market revival. Prime government
agencies have, under the Public Private Partnerships (PPP) framework, assumed a unique
facilitating role without undermining the pervasive influence of the regulatory ideology.
This paper investigates the dynamics of the public private interplay that has resulted from
the West Bengal Government’s Public Private Partnership policy in supplying affordable
housing in Kolkata.

The supply of land is the key for an adequate and affordable housing for all. Urban land
has been a principal tool for West Bengal Government’s policy to maximize real estate

36
activities and an incentive to encourage the private enterprises. In recent years, the state
government has started playing a far more aggressive role in the urban land market by
developing and allocating land through townships, so that housing development
initiatives are not constrained owing to scarcity of land. Another important factor is state
government promulgated West Bengal Building Act in 1993 to initiate and regulate
privatization. This act meant to control the building activities of the private promoters
and protect the interest of property buyers.

(Sengupta, Urmi, 2004)

2.6.2 Housing for all by 2022

In India housing and indeed all affordable housing has been the exclusive preserve of
public sector entities such as Housing Boards or Development Authorities. Private sector
real estate developers have been historically precluded from affordable housing both
structurally and at the level of policy. Developing affordable housing in Indian cities
faces significant challenges due to several economic, regulatory and urban issues. Whilst
the lack of availability of urban land, rising construction costs and regulatory issues are
supply-side constraints, lack of access to home finance is a serious demand-side
constraint, which impacts the ability of low-income groups to buy housing. Although
some of these are gradually being mitigated, efforts are required by multiple institutions
to facilitate mass development in this sector.
Regulatory Constraints
There are severe regulatory constraints to real estate development in Indian cities, which
range from lengthy approval processes to lack of clarity in urban planning. According to
the new government in the Indian central power, it has a vision to provide housing to all
its citizens by the year 2022.
Housing for all by 2022 presents a dramatically different opportunities and requirements
in front of the stakeholder. Housing in India varies significantly and can reflect the socio-
economic mix of its vast population. In the last decade, there has been tremendous
growth in the country’s housing sector, along with demographic changes, rise in income,
growth in the number of nuclear families, and urbanization. Key factors considered in the

37
scheme are - Absence of an effective policy framework for Economically Weaker Section
(EWS) and Lower Income Group (LIG) housing, long gestation period of six to eight
years of housing projects, inadequate long-term funding across the project life cycle,
rational multiple fees and taxes across project stages, reassessment of development
norms, high urbanization rate, need to focus on urban housing; especially on affordable
housing.

The Government would soon roll out Sardar Patel Urban Housing Mission, which will
ensure 30 million houses by 2022, mostly for the economically weaker sections and low
income groups. This Mission is in pursuit of the provision of mammoth housing goal and
30 million houses would be built by 2022, mostly for the economically weaker sections
and low income groups, through public-private-partnership, interest subsidy and
increased flow of resources to housing sector.
Development of large-scale affordable housing is the greatest necessity of urban India
today. Indian cities lack them, and this has resulted in the proliferation of slums and
unorganized real estate across the landscape. This is detrimental to the planned growth of
cities. Large-scale urban developments are becoming increasingly difficult due to lack of
land parcels, congested transit routes, lack of finance, rising input costs and regulatory
hurdles. However, it is vital that these issues are addressed urgently so that a
comprehensive framework can be established in ensuring the development of affordable
housing.

Demand Side:
Formulate guidelines for identifying right beneficiaries - There is a need to formulate
guidelines that would help identify right beneficiaries for affordable housing projects.
This would help in ensuring the reach to right beneficiaries and avoid involvement of
speculative investors into the projects. Creation of the National Population Register and
issuance of unique identity through Unique Identification Authority of India will become
crucial steps in identification of right beneficiaries, if they are linked with income levels

Innovate on micro mortgage financing mechanisms to ensure a larger reach -

Effective financing through micro mortgages by utilizing the reach of Self-Help Groups

38
(SHGs) and other innovative financing mechanisms would ensure that housing finance is
available to large sections of LIG and EWS populations. Flexible payment mechanisms
should be put into place, as households in low-income groups typically have variable
income flows.

Supply Side:
Incentivize developers to develop affordable housing- ULBs and UDDs can develop
guidelines by giving free sale areas, extra Floor Space Index (FSI) and other policy
measures so that real estate developers are incentivized to develop affordable housing.
Schemes for redevelopment and slum rehabilitation should be developed with incentives
that generate sufficient returns for the developers. The cost-benefit analysis of regulations
should be carried out from a development perspective to ensure that schemes to facilitate
the development of affordable housing are feasible.
Streamline land records to improve planning and utilization of land - Adequate
availability of land should be ensured for housing and infrastructure by computerization
of land records, use of Geographical Information Systems, efficient dispute redressed
mechanisms and implementation of master plans.
Include mass housing zones in city plans and develop them within a planned
schedule - Some cities have already dedicated zones in their master plans for
development of affordable housing. Whilst this needs to be replicated in other cities and
towns, it should be ensured that they are developed within a planned schedule
Enact rental housing schemes in urban areas - Authorities like MMRDA have
experimented with rental housing schemes, but these have not been very successful as a
proper framework has been missing for such schemes. Limitations in such schemes
include development in far-flung areas, which are not suitable as affordable housing
locations and lack of means to identify end users.
Formulate policies for greater participation from private sector in the way of
technological solutions, project financing and delivery - Disruptive innovation in
terms of technological solutions, project financing and delivery is required, which
reduces costs of construction significantly despite rising costs of inputs. As construction
costs form a significant portion of the selling price of affordable housing units, the
savings in construction can immensely benefit the occupier. (CREDAI, 2014)

39
2.6.3 Role of Rental Housing in Housing supply

The rental housing market in India forms about 30% of all the dwellings in urban India.
Despite shortage in urban dwelling, a significant number of houses in urban India are
lying vacant. Based on 2011 census, an estimated 11mn houses are lying vacant. When
this figure is compared to shortage 18.78mn houses, it appears that rental housing could
actually significantly bridge the gap.
The Ministry of Housing and Urban Poverty Alleviation (MHUPA) has ongoing
programs in the housing domain such as JNNURM, ISHUP, and RAY; however, most of
them are oriented towards home ownership. Schemes related only towards home
ownership are, however, unlikely to solve the urban housing problem. There is growing
recognition that the housing shortage cannot be solved through incentives for ownership
alone. Unless tackled creatively, it will lead to a higher cost of living with an
accompanying lower quality of living in our cities.

Key observations from existing Rent Control Acts:

▪ Rent control is only necessary for those houses that are targeted at the
EWS/LIG segment. There is no need for rent control to be applied across the
spectrum of Rental Housing.
▪ Even for houses under purview of Rent Control act, the mechanism for Price
fixing has to be market determined.
▪ Allowed rent increases are arbitrary and are not benchmarked against the
market or macroeconomic conditions
▪ Similar to registration, repossession is still a long drawn process involving
tedious and time consuming judicial process.
▪ Since the rent control act is not applicable for tenures less than a year, a
significant number of leave & license agreements are drafted to be less than 1
year resulting in more stamp duty cost, more administrative load etc.

The Task Force concluded that Rental Housing is particularly apt and even a necessity for
a significantly large segment of households and individuals. Rental Housing satisfies the
needs of this demand segment in ways which cannot be satisfied through House
Ownership.

40
The demand side of rental housing consists of three major segments namely:
Permanent -households settled in the urban areas but unable to buy a house, Transient -
households where individuals migrating from other parts for the purpose of employment
education looking for temporary abode and Captive - householdswho live in tenements
provided by corporates.

The Supply side of rental housing consists of the following key participants namely,
Individual Landlords–who are unorganized individual landlords that provide rental
housing to households and individuals, Institutional Landlords – large companies that
provide organized rental housing to households and individuals, Hostels or Dormitories –
these are large and small providers that offer shared stay primarily to individuals and
Corporate/Captive Housing – employers that provide housing to staff.

2.7 Real Estate Property Overview - Pune

In the long run, growth in real estate prices in Pune is likely to be positive as it continues
to be an IT, education and manufacturing hub which will offer huge employment
opportunities and keep the end user demand ticking in this city.

Growth in real estate prices in Pune is expected to be positive as it continues to be an IT,

education and manufacturing hub and keep the end user demand increasing in this city.
The prices have gone above affordability levels of end users in the city. The major factors
responsible for an increase in property rates are land cost and construction by the
developers. Apartments in Pune have witnessed a contraction in the configuration sizes,
to match the budget of the end users. Many developers are tapping NRI investors. This
has further added to the spiraling prices of properties in Pune. The growth in residential
real estate market has been largely driven by rising disposable incomes, a rapidly
growing middle class, and fiscal incentive on both interest and principal payments for
housing loans, demanding expectations of aware customers as well as increasing city
limits and increasing number of nuclear families.

All the above factors have increased investor demand from outside Pune, while demand
from Pune end users and maintain sales.

41
Pune residential apartments have witnessed a contraction in configuration sizes. The
research also talks about major locations of the Pune city are various growth stimulators
responsible for the development of the city.

Area of Pune has been increasing due to addition of fringe developing areas. This has
served to decrease pressure on the central city encouraging an outward growth pattern.
Pune real estate market today is buoyant and inviting. Upcoming projects like
International airport and Metro rail would be changing the dynamics of the city as it may
give increased floor space index (FSI) in the nearby areas, thus increasing the demand.
As explained in the graphs, Pune needs to continue this growth and exploit its potential to
its fullest so as to make the percentage growth rate sustainable. The trends exhibited in
the graph clearly shows that rates are continuously increasing except for recession
period.(Pune Real Estate Property Overview, March 2015)

2.8 Residential Location Preferences

A residential location preference in urban areas is an important subject of research. In all

cities, residential land use makes a prominent land use. These residential areas are
divided into various zones depending upon various characteristics such as connectivity,
surroundings, facilities and amenities available, distance from work place etc. Depending
upon these characteristics, different zones in residential land uses observe different scale
and pace of development and different property values.

Various parameters for residential location preferences include affordability, work place
distance, cost of building or land, distance from city center/ market place, community
preference, distance from school, facilities and amenities available, development trend,
travel cost, travel time, surrounding environment, development plan proposals,
population density, population of neighborhood, local governing body etc.
(Petkar, 2013)

Above factors decide growth corridors of the city also make a residential fabric of the
city which accommodates various communities, cultures and income groups.

42
As every growing metropolitan city, Pune has also undergone spatial expansion of the
city. People prefer to move outside core area in search of better and affordable housing
options. New Sub urban areas of the city like Kothrud, Bibvewadi, Sahakarnagr
developed in very rapid pace along with the amenities and infrastructure.

The pattern is still continuing in terms of residential development as new areas, which
can be called as fringes of the city are started developing with residential developments.

2.9 Need for Housing Policies

2.9.1 Urbanization and Development

‘Urban’ India is defined as a human settlement with a minimum population of 5000

people, with 75% of the male working population engaged in non-agricultural activities
and a population density of at least 400 people per sq.km.

The scale of Urbanisation is currently underway in developing countries, including India.

India’s urban population grew from 290 million in 2001 census to around 340 million in
the year 2008 (Mckinsey 2010). The urban expansion in India is happening at an
unprecedented rate. It took 40 years to add 230 million to India’s urban population. It is
estimated that the next
addition of 250 million to
urban population would take
place in half the time. It is
projected that in India urban
economy will provide 85%
of total tax revenue and will
benefit nearly 200 million
rural Indian populations who
are living in the proximity of
India’s largest 70 cities
(Mckinsey 2010).

Fig No 2.1 Rural Urban Population split in India

43
44
The cost of not paying attention to the needs of the cities is enormous. Today, lack of
comprehensive policy may cause urban decay and gridlock, a decline in quality of life of
citizens. Thus, addressing the issues of urbanization is going to be a central pillar of
inclusive growth.

2.9.2 Growth of Slums and Informal Settlements

Rapid urbanizationhas placed tremendous pressure on resources of national and local

government. The need for planned and affordable land, housing, services is to be satisfied
through the efforts of Governmentor private sectors. As a result, the urban poor have
found their own solution in various types of slums and informal or unauthorized
settlements. A majority of the urban citizens thus have to endure substandard and
subhuman living conditions within the Indian cities. The affluent minority of urban

45
citizens are also affected directly or indirectly by the health and social risks of the
neglected majority.

2.9.3 Escalating Urban Land rates

Land scarcity is the main problem faced by today’s metropolitan cities. Making land
available for housing developments is a major challenge faced by planning authorities.
With rapid urbanization migration rate to cities have been increasing in a fast rate. This
resulted in growing demand of housing from different economic sectors. Lands in the city
areas are already developed. Land scarcity resulted in escalating land prices in most of
the cities. Land prices are directly proportional to housing demand in different areas.

Escalating urban land rates became a key reason making housing unaffordable to
common man. There is a strong need of policy to control land rates minimizing the
problem of housing affordability.

2.9.4 Rural to Urban Migration

It is a significant fact that 79% of the new jobs that is 19.3 million during 1991-2001
were generated in urban areas and only 5 million jobs were generated in rural areas. As
rural-urban migration and urbanization will continue, the urban areas will have to absorb
an ever-growing population. Rural-urban migration should not result in poor and non-
inclusive urbanization. Ensuring the growing population will have acceptable housing,
with access to essential infrastructure and services. To find adequate employment and
income would be an enormous challenge for local governments. As India’s labor force is
witnessing rural to urban shift, it is utmost important that the rural and urban areas
develop in a symbiotic manner.

2.9.5 Balanced Regional development

Often the poor, whether in urban or in rural areas, remain excluded from development.
They do not receive recognition from society and the economy for the contributions they
make for the development. Balanced development, therefore, does not only mean
balanced investments in urban and rural areas and in regions within countries but it also
means an equal empowerment in all regions within countries to decide their development
path.

46
2.9.6 Greenfield development

40% of India’s population is expected to live in urban areas by 2030. It is necessary to

develop new planned housing to accommodate the expected change. New integrated
townships are thus, the need of hour. Housing policies need to be incorporated, required
for planning of these townships.

2.9.7 Role of Housing

Housing has been always a major component in any community. Housing sector plays a
major role in overall development of the city. As cities grow, need for housing of
different economic sectors also increases. Housing forms a fabric of the cities. Housing
along with the social and physical infrastructure helps to form a sustainable community.

2.10 Housing Policies and Programs

2.10.1 Five Year Plans

The Government of India adopted a central planning model of development. The

Planning Commission of India is the central agency which prepares the five-year plans.
They give broad allocation of financial resources to various sectors of the economy.
Based on the five-year plans, annual plans are prepared by state governments for
implementation.

A look at the five-year plans reveals the manner in which the Government of India had
perceived the housing sector in the initial years and the manner in which it sees it now.
Financial allocation for housing as a percentage of the total investment in the economy
was as high as 34 percent in the First Five Year Plan (1951-56) but has now come down
to as low as 2.4 percent in the Tenth Five Year Plan (2002-2007).

Table No 2.1 Five Year Plan Initiatives

Plan Period Focus Initiative

I PLAN ▪ Refugee Settlement ▪ Construction of houses for

(1951-56) Housing in Metros employees & weaker Sections.
curbing land ▪ Institution Building - Creation of

47
 speculation. Ministry of Works& Housing,
NBO, TCPO & Housing Boards
Building of Chandigarh.

II PLAN ▪ Master Plans ▪ Delhi Master Plan & creation of

DDA.
(1956-61) ▪ Institutional Finance
▪ LIC to provide loan for MIG.
▪ Subsidized schemes
▪ Schemes for Plantation Labor,
Village Housing, Land
acquisition, SC/ST Housing,
Hand loom Weavers.

▪ First statement in parliament on

housing policy (14th August,
1957).

▪ Priority for subsidy to needy, for

rest loans for house construction
or purchase.

▪ Setting up State Institutions for

housing.

III PLAN ▪ Master Plans, State ▪ Master Plans for Major Cities,
Capitals Building State Capitals i.e.
(1961-66)
Gandhinagar, Bhubaneshwar.
▪ Economic Policy
Linkages ▪ Housing near dispersed Industry
Committee constituted for Land
▪ Land Police
Acquisition.

ANNUAL ▪ Concept of EWS ▪ Provision of finance for EWS

PLANS housing introduced housing
(1966-69)

IV PLAN ▪ Urban Land Policy ▪ Creation of HUDCO & Urban

48
 Development Authorities in
(1969-74) ▪ Urban Development
metro cities.
Finance
▪ Launching Environmental
Improvement scheme for Slums
(EIS).

▪ Encouraging S & S (Site and

Services) Schemes.

V PLAN ▪ Urban Poverty ▪ Urban Land Ceiling & Regulation

alleviation Act.
(1974-79)
▪ Metro Cities ▪ Integrated Urban Development
Program for Large Cities.

▪ Task force on small and medium

size towns.

▪ Basic minimum needs program.

▪ House Sites for landless labour.

VI PLAN ▪ Development of ▪ Launching IDSMT scheme.

secondary town.
(1980-85) ▪ EIS & Low cost sanitation
▪ Urban Poverty schemes for EWS continued.
Alleviation ▪ Provision of house sites rather
than subsidy.

VII PLAN ▪ Urban Poverty ▪ Launching of Urban Basic

Alleviation services scheme.
(1985-90)
▪ Urban Basic Services ▪ Creation of private Housing
in backward towns Finance Institutions.

▪ Setting up of NHB & National

Commission on Urbanization.

▪ Draft National Housing Policy.

49
VIII PLAN ▪ Employment ▪ Launching of Nehru
Generation RojgarYojana and UBS for poor.
(1992 –97)
▪ Urban Basic Services ▪ 74th Constitutional Amendment
Act.
▪ Strengthening Urban
Local Bodies (ULB) ▪ Integrated Urban Poverty
Eradication Program.

IX PLAN ▪ Promoting mass ▪ Creation of Urban Development

transportation. Fund.
(1997-2002)
▪ Environmentally ▪ Large external assistance for
sustainable cities. urban & rural water supply.

▪ Municipal Governance. ▪ Creation of National Data Bank

and monitoring cell.

X PLAN ▪ Public Private ▪ Assistance for promoting rental

Participation. housing in private sector
(2002-2007)

▪ Strengthening ULB ▪ Foreign direct investment in

autonomy. Town ship building

XI PLAN ▪ Increase supply of ▪ Land pooling and land sharing by

developed land. public Agencies with Statutory
(2007– 2012)
support to private sector.
▪ Land Banking.
▪ Special courts to settle land
▪ Viability Gap Funding
compensation disputes.
for infrastructure and
housing projects. ▪ Equitable compensation in cash
or kind
▪ Rental Housing
▪ Statutory provision for reserving
▪ Integrated city
10% -15% land for EWS / LIG
development
housing up to 20% - 25% of units.
▪ Legislative and fiscal

50
 incentives for making ▪ Special safeguards to prevent
housing as liquid asset. speculation and resale.
▪ Sustainable resource ▪ Re-densification with additional
management. FAR and TDR facilities
▪ Housing Safety ▪ Central Government support to
▪ Enhanced role of bridge gap between affordable
Housing cooperatives cost and viable sale price.

▪ Model Rent Act

▪ Assistance to Institutions for

Employee Housing

▪ High density settlements with

rapid transit system.

▪ Stamp Duty Reductions.

▪ Computerization of property
registration & transfers.

▪ Documentation of ownership
records.

▪ Mandatory provision to
incorporate in projects certain
measures like Rain water
harvesting, to obtain Local
authority permissions.

▪ New building code for Disaster

Resistant Housing.

▪ Initiate Techno-Financing regime.

51
2.10.2 Housing Programs of Government of India (1947 - 2015)

While many programs were initiated in the early decades, not many exist in the later
years. However, the major findings could be generalized as follows:

1) The funds available in these programs are too meager to meet the requirements of
the local needs.

2) Funds are not spent on time on account of the lack of capacities at local agency
level.

3) Most programs are 'top down' concepts which do not really involve people and
therefore not acceptable.

4) Assets created from these funds often do not go to the beneficiaries intended.

5) Where a loan component is involved, the recovery is very poor.

Table No 2.2 Housing Programmes of government

Sr. No. Name of Program Year of Launch

1. Integrated Subsidized Housing Scheme for Industrial 1952

Workers and EWS

2. Low Income Group Housing Scheme 1954

3. Subsidized Housing Scheme for Plantation Workers 1956

4. Slum Clearance and Improvement Scheme 1956

5. Middle Income Group Housing Scheme 1959

6. Rental Housing Scheme for State Government 1959

employees

7. Village Housing Projects Scheme 1959

8. Land Acquisition and Development Scheme 1959

52
 9. Provision of House Sites of Houseless Workers in 1971
Rural Areas

10. Environmental Improvement of Urban Slums 1972

11. Sites and Services Schemes 1980

12. Indira AawasYojana 1985

13. Night Shelter Scheme for Pavement Dwellers 1990

14. National Slum Development Program 1996

15. 2 Million Housing Program 1998

16. Valmiki AmbedkarAawasYojana 2001

17. Jawaharlal Urban Renewal Mission 2005

18. Rajiv AwasYojana 2013

19. Housing for All by 2022 2015

2.10.3 National Housing and Habitat Policy:

Basic focus of the national housing & habitat policy is:

▪ Role of Government Institutions as Facilitator

▪ Decentralization

▪ Increased Role for Private sector

▪ Fiscal Incentives & Concessions

▪ Acceleration of Housing Finance Flow

▪ Environmentally Cost Effective Technology

53
Table No 2.3 Framing Plan and Implementation of the Policy

Sr. No. Agency Role

1. Central Government ▪ Global resource mobilization.

▪ Macroeconomic policies to ensure fund flow.
▪ Urban reforms (Municipal Functions).
▪ Fiscal concessions
2. State Government ▪ Prepare State Policy Document
▪ Local Body Empowerment for regulatory
and development functions
3. Urban Local ▪ Housing action area plans
Government ▪ Promote integrated townships
▪ Enforcement of regulatory measures
▪ Direct procurement of land
▪ Implement state & central sector programs
▪ Undertake participatory planning
4. Housing Finance ▪ Promote innovative financing mechanisms
Institutions like mortgage guarantee insurance
▪ Devise innovative lending schemes for poor
like Micro credit mechanism.
▪ Flexibility in credit appraisal
5. Public Agencies ▪ Use of land as resources
▪ Reduce dependence on budgetary support
▪ Participation of public and private sector
6. Private Sector and ▪ Create housing stock on rental & ownership
cooperatives ▪ Active role for land assembly
▪ Collaborate with Public sector for slum
rehab
7. Research and ▪ Address varied climatic zone designs and
Development Agencies Environment friendly technologies
▪ Construction Standards for building
components, materials etc.
▪ Intensify lab to land transfer of research &
technologies
▪ Strategy for water shed management

54
 Table No 2.4 Comparison between the National Housing Policy 2007 and the State
Housing Policy
CENTRAL GOVERNMENT
Focus Area
▪ Creation of Housing Stock for
ownership and rental housing.
▪ Supply of service land.
▪ Infrastructure up gradation.
▪ Balanced regional growth.
▪ Shift to cost recovery cum
subsidy scheme.
▪ Proactive financing.
▪ Urban Centers as Engines of
growth with rural hinterland
development through linkages.
▪ Convergence of resources, FDI
promotion, PPP
▪ Promoting secondary mortgage
market.
Land
▪ Acquisition by Public Agencies
with focus on Land sharing,
Land pooling, Private sector
involvement with certain
safeguard to be determined.
MAHARASHTRA
Focus Area
▪ Creation of adequate housing stock.
Promoting Employment
▪ Promoting opportunities
▪ Promoting sustainable growth
▪ Pursuing cities without slum
▪ Deregulating Housing Sector
▪ Involving private participation
▪ Rationalizing D C Rules
▪ Streamlining approval procedure
▪ Promoting rental Housing
▪ Ring fenced infrastructure fund
▪ Priority for Metro problems
Land
▪ Adequate land supply and zoning for
Low Income group
▪ Development of Peri-Urban Areas
▪ Efficient LIG schemes through higher
55

▪ Land reservation for poor in
Master Plan
▪ Tenure rights for Slum Dwellers
in-situ or elsewhere
▪ Allotment of land in schemes as
per Government directives
56
FSI
▪ Vacant land tax
▪ Public housing through PPP
▪ Property value index based TDR for
LIG/MIG in identified zones
▪ Single Window Approach for NA
permission and for change from one
NA use to other.
▪ Assessment to be levied from the date
of commencement.
▪ For MIG affordable housing by
Corporations within MMR to
decongest, FSI raised from 0.5 to 1
Finance
▪ Integration of Debt and financial
market.
▪ Development of secondary
mortgage market with supportive
fiscal and regulatory frame work.
▪ Stamp duty on residential
mortgage backed security to be
rationalized.
▪ Fiscal incentive to promote
rental housing and service
apartments.
▪ Rental market to have flat rate of
taxation and higher depreciation.
▪ National Shelter Fund to be
constituted by NHB for lending
Legal and Regulatory Reforms
to EWS by Primary HFIs.
▪ NHB to float tax free EWS
HOUSING BONDS.
▪ Risk fund by NHB: resource
mobilization by 1% surcharge on
disbursement of incremental
housing loan by HFIs.
▪ Promote Foreign Direct
Investment
▪ Real estate Investment fund and
Real Estate Mutual Fund to
facilitate small investor to
benefit.
57
Finance
▪ Subsidized serviced government land
for Low Income Housing.
▪ Linking Employment generation
scheme to LIH construction in Rural
Areas and small cities.
▪ State commitment of finance for the
centrally sponsored scheme.
▪ Enabling use of land as a collateral
security for mortgage.
▪ Creation of a dedicated “Housing &
Infrastructure development fund”.
▪ Cross subsidization for MHADA
Housing scheme.
▪ Repel of urban Land Ceiling Act
▪ Rent control Act amendment to ensure
return
▪ Building approvals by registered
Architects
▪ Revision of base for levying
Development Charges, and Property
tax.
▪ Law to curb encroachment on public
land.
Legal and Regulatory Reforms Legal and Regulatory Reforms

▪ FAR / FSIto be optimizedin the ▪ Single window approach for

context of Infrastructure sanctioning Bldg. Plans

▪ Mortgage Insurance to be ▪ Registered Architects to be

facilitated by amending Act. empowered to sanction.

▪ Housing Co-Ops to be enabled to ▪ Time bound preparation of Master

take up Slum rehab. Plans to be operative before expiry of
current plans.
▪ Reduction in stamp duty to 2-3%
▪ Adoption of Model Municipal Law
▪ Land revenue records to be on
and Model Rent Control ACT.
GIS within a time frame.

▪ Enactment of Apartment
Ownership Act.

Building technology for housing Building technology for housing

▪ Promotion of Building materials ▪ Promote Eco housing

from agricultural and industrial ▪ Low energy consuming construction
waste
▪ Promote precast and prefabricated
▪ Promotion of Low Energy building component.
consuming construction
▪ Enforce National Building Code.
▪ Promotion of pre-fabricated
▪ Enforce earth quake resistant
components
construction guide lines.
▪ Code for disaster resistant
construction

▪ Architects and Engineering

colleges to teach cost effective
construction systems & Building
materials

58
Infrastructure
▪ Infrastructure Action Plans to
plug Systems losses, leakages
and wastages.
▪ PURA based demonstration
Projects.
▪ FDI for Infrastructure projects.
▪ Eco friendly Public transport
system.
Ecology Aspects
▪ Norms for consumption of key
resources and construction
materials
▪ Sustainable strategies for
maintenance.
▪ Norms for containment of Urban
Sprawl.
▪ Model bylaws for use of
renewable energy.
Slum Redevelopment
▪ Schemes with cross subsidization
▪ Land pooling and sharing
arrangement.
Infrastructure
▪ Development to be integral part of all
projects.
▪ Housing and Infrastructure fund to be
used by local bodies in addition to
state funding.
▪ State Government to support ULB for
market borrowing for infrastructure
projects.
▪ State Agencies to facilitate PPP
▪ Private developers to fund and provide
infrastructure in Township Projects
Ecology Aspects
▪ Eco housing projects through rebate &
development charges.
▪ Local bodies to popularize and
promote measures such as Total Water
Management, Energy conservation,
Eco friendly and energy efficient
materials, Environment Architecture,
Renewable Energy, Solid waste
Management.
Slum Redevelopment
▪ Projects on Infrastructure and vital
public projects land to be settled on
priority
59
▪ TDR/FAR to be used as ▪ In situ redevelopment through menu of
incentive options

▪ Houses not to be transferable for ▪ Security of tenure.

10 years. ▪ Government land after redevelopment
▪ Land as resource concept to be to cooperatives on lease or occupancy
applied. basis.

▪ Multipurpose cooperatives to ▪ Slum cooperatives and NGOs to be

take up rehabilitation with social, allowed to raise funds by use of land
economic and physical tenure as collateral.
development. ▪ Redevelopment of public land by
transparent competitive bidding of the
development rights.

▪ Surplus FAR for LIG housing.

▪ Profits for infrastructure.

▪ Transparent identification of
beneficiaries.

▪ Developers and NGOs to have credit

rating.

▪ Bio-metric survey, GIS mapping,

Satellite ideography, Unique I D
number system to be used.

▪ Third party audit of redevelopment

projects.

▪ Large slum areas to be developed as

township.

60
2.11 Housing Legislation:

Important planning legislations which have considerably affected the housing scenario in
Maharashtra are described in brief.

2.11.1 Urban Land Ceiling and Regulation Act (ULCRA) of 1976

The urban land ceiling reflected the government's concern for equity. The Urban Land
Ceiling and Regulation Act (ULCRA) of 1976 were applied to 73 cities. Its main aim and
objective was to ensure orderly, urban development, restraining speculation and price
escalation in land, and also in promoting low-income housing. The act imposed a ceiling
on the vacant land holding of individuals, limits size of future dwelling units and
regulates the transfer of urban property.

Land in excess of the ceiling limit was to be compulsorily acquired by paying a nominal
compensation and then redistributed for public purpose, generally to the public sector for
development of mass housing i.e. housing for L.I.G. and E.W.S. by restricting the supply
of developable land.The ULCRA in Maharashtra was applicable in eight cities of the
state, with stipulation against holding more than 1,000sq.m of land by an individual in
Kolhapur, Nasik, Nagpur, Pune, Sangli, Solapur and Thane. However, in Mumbai, the
stipulation limited individual land holding to 500sq.m

Reasons for Repeal of the Act:

The aim of the ULCRA Act was to free up land for low-cost housing for the poor by
prohibiting private individuals from holding more than 1000sq.m of land in notified areas
of the country, and providing housing to the urban poor. In spite of its good aims the act
was not able to achieve its objective due to its poor performance. Out of 2, 20,675 ha of
estimated excess vacant land, 50,046 ha of vacant land vested in the State Governments
Physical possession was acquired only of 19,020 ha. of vacant land by the State
Governments. The public housing agencies which were not able to handle the large
number of land in the urban areas was acquired under the ULCRA Act. It was due to the
inefficiency of the public housing agencies which were not able to provide low cost
housing for the urban poor.

61
There was demand to repeal this Act so that the stock of urban land increases and
development of urban land for various sectors namely, housing, transport, industry, etc.
can be made available. The Government decided to repeal this act. Repeal of this act
would also facilitate the availability and affordability of urban land, by increasing supply
of urban land.

2.11.2 Gunthewari Act 2001

The Gunthewari Act is used for regularization of constructions in unauthorized layouts

made by people of lower middle income group. It was categorically mentioned that
public utility lands which are vacant will not be de reserved under Gunthewari Act.

The Gunthewari Act was needed as number of unauthorized constructions in various

layouts had increased to a very large extent. To regularize these unauthorized
constructions,Gunthewari Act was brought into existence. These unauthorized layouts
were developed due to the shortage of land availability in the urban areas which is said
that had occurred due to the urban land ceiling act (ULC Act) in which excess of land in
the urban area holding by a single person was acquired by the government at a nominal
rate and was supposed to be developed by government for housing purpose.

The land which was acquired under the ULC Act and which was supposed to be brought
under housing development by the public housing agencies, was not developed as
intended. On the other hand, leading to shortage of land in the urban areas, people started
to develop available land on their own without following regulations. One can say that
Gunthewari Act was the result of failure of ULC Act which to attain its purpose

Transfer of Development Rights (TDR), 1990

Where some private land has to be exclusively put to reserved use for common good of
society around no building construction is permissible, this regulation allows the
landowner to transfer his development rights elsewhere in the jurisdiction of same
authority. In both these cases if the landowner does not come forward, the right to
compulsorily acquire the land is retained by the planning authority. Implication of TDR
appears credible when real estate prices are increasingly unabated. Planners try that TDR
flows from congested areas to relatively low-density areas.

62
Impacts of the TDR on Housing:

1. Density of the Areas:

There is little doubt that the Slum TDR programs have increased population density on
many slum sites. That is inherent in the design of the program, because the additional FSI
allows the construction of more dwelling units than initially are on the site. After an SRA
project is completed, slum residents are housed vertically, rather than horizontally. As a
result, they may have more open spaces around the building, but they also have more
neighbors in the form of owners of market-rate flats on the same sites. On sites in
especially valuable locations (i.e., nearer the core of the city and with easy access to
transportation or open space), builders try to maximize the number of flats they can build
on site, because the value of those flats exceeds the sale value of the TDR.

In those cases, the builder may even try to conspire with community leaders to reduce the
list of eligible slum dwellers in order to reduce the amount of the site required for slum
housing and increase the area available for market-rate housing.

2. Private Market Housing Investments:

To date, no data is available about how the various TDR programs have an influence on
the type, amount, or quality of housing produced. The rate of private housing
construction is important, because for every unit produced reduces pressure on the
existing stock, which tends to mitigate price increase and make it relatively more
important for medium and lower-income groups to move to better housing. One clear
impact is that the Slum TDR program has resulted in significant private housing
construction in popular locations. As one analyst summarized,

“The viability of a Slum Rehabilitation Authority proposal depends on the differential

between the sales price of additional apartments built and the cost of the apartments built
for resettled families.”

3. Real Estate Market Impacts:

Since TDR programs represent manipulations of the real estate markets, it would be
helpful if their impacts were measured more carefully. The TDR is expected to be used as

63
a tool for development & for providing affordable housing to slum dwellers. It is
indirectly affecting the real estate market.

4. Impacts on Infrastructure:

Since one of the first objections to TDR is that existing infrastructure is not adequate to
handle density either in ‘sending’ or ‘receiving’ areas. There is no evidence that
additional FSI due to TDR resulted in additional shortages of water, sewer, electricity, or
inadequate drainage in areas.

2.11.3 Maharashtra Apartment Ownership Act:

This act deals with the "Apartment ownership rights" and "Deed of apartment". Each
apartment, together with its undivided interest in the common areas and facilities
appurtenant to such apartment for all purposes constitutes heritable and transferable
immovable property.

Under the act an apartment owner may transfer his apartment and the percentage of
undivided interest in the common areas and facility appurtenant to such apartment by the
way of sale. The apartment owner can use the common areas and facilities in accordance
with the purpose for which they are intended without hindering or encroaching upon
lawful rights of the other apartment owners. The act has laid down that the necessary
work of maintenance, repair and replacement of the common areas and facilities and the
making of any additions or improvement are to be carried out only as provided in the act.

2.11.4 Special Township Notification 2006:

It is a part of the Maharashtra Regional & Town Planning Act of 1976, based on which
many integrated township projects in Pune have sprung up.

There are general norms for the township development. The residential area should be
well defined in clusters or neighborhood & out of total floor area proposed at least 50%
shall be used purely for residential purpose. The township should have the
comprehensive educational systems (primary & secondary schools as per requirements).
The area allocation for amenities should not be less than 5% of the gross area. Along with
these the provision of adequate public utility, transportation, and health facilities should
be as per the requirements.

64
There are also certain special concessions while developing a special township: -

▪ As soon as the scheme is notified, lands will be deemed to have been converted
into non-agriculture use & no separate permission is required.

▪ Stamp duty rates applicable in township area shall be exempted to the extent of
50% of the normal charges.

▪ Development Charges - A special township shall be exempted from the payment

to the extent of 50%.

▪ Grant of government land - any government land falling under township area shall
be leased out to the development at the prevailing market rate.

▪ There is no ceiling limit for holding agricultural land to be purchased by the

owner/ developer for such project.

▪ The township project shall be partially exempted from the payment of scrutiny fee
being levied by the planning authority.

2.11.5 Recognition of Cooperative Housing Societies:

Co-operative movement in India started in 1909 and is 100year old. It remained dormant
till independence that is 1947. There is no separate legislation for Housing Co-operatives.
These are constituted under provisions contained in general Cooperative Societies Act.

However, various State Acts are not uniform. General Acts do not efficiently facilitate
special functions of Housing Co-operatives, such as Promotion, Registration,
Supervision, Transfer & Exchange of flats and loan recovery. To be able to perform
efficiently above functions, Housing Co-operatives need to be recognized as Corporate
Body.

Co-operative Housing Societies, Democratic Institutions which are operated on no lossno

profit basis can facilitate joint ownership and construction of the Housing projects by the
people and for the people.

65
Hierarchy:

▪ National Cooperative Housing Federation (National Apex)

▪ State level Apex Federation (State Level Apex)

▪ District level Federations

▪ Primary Cooperatives constituted under state Acts

There are following types of housing Co-operatives present:

1) Tenant Ownership housing societies - Members own properties, subletting,

transfer and similar forms of profiteering are not allowed.House construction as
per individual priorities and needs.

2) Tenant Co-operative Housing Societies - Members occupy houses under

limitations. Members are shareholders and occupy houses by paying rent

3) House Mortgage Society: Credit Society to lend for limited objectives, Lend
construction finance to members, and construction responsibility of members.

4) House construction/ House building societies: Societies borrow funds on behalf of

members, construct houses/flats, hand over to members and recover loan from
them

Maharashtra has enacted CO-OP Society Act in 1960. Existing Societies with completed
houses can come up again for redevelopment to take advantage of increased FSI and
revised bylaws

2.11.6 Rent Control Act:

This act had tenant protection as primary objective. Its focus was on following issues,

▪ Rent control

▪ Rent revision

▪ Restrictions on evictions

Owner was responsible for maintenance of property in habitable conditions

fixing of fair rent - mostly fair to tenant.

66
Landlord has no right to lease to people of his choice - Vacancies to be reported to the
authority.
Eviction of tenant was possible on,

▪ Nonpayment of rent

▪ Property misuse

▪ Availability of alternate accommodation of

▪ Requirement of Premises for self-use

Impact of rent control on housing market is substantial. It had a Negative impact on

investment in rental Housing. It led to withdrawal of supply from existing rental housing
market. It accelerated depreciation of residential buildings due to inadequate
maintenance. At times, surplus stock remained locked up and unused. If the rent control
act is abolished then the rents will rise abnormally, also it would mean increase in
lengthier litigation, as short and speedier procedure under the Act will not be available.

Table No 2.5 Hierarchy of Role of Government

Role
Level Finance Implementation Advice
National ▪ National Housing ▪ NBCC ▪ MOUD &
Bank PA
▪ Defense Housing
▪ HUDCO Boards ▪ HUDCO
▪ LIC/GIC ▪ CGEWHB ▪ NBO / CBRI
/ SERC
▪ HDFC ▪ CPWD
▪ BMTPC
▪ National Apex Co
OP
▪ Schedule Banks /
Infrastructure
Leasing
State ▪ State Apex Coops ▪ Housing Boards/Dev.
Bank Subsidiaries Authorities
▪ Cooperative ▪ Slum redevelopment
Banks Agencies
▪ Rural Housing Boards

67
 ▪ State Water Supply
Sewerage Boards
▪ PWD
Local ▪ Local Banks ▪ Urban Local Bodies
▪ Private leasing ▪ City development
Institution authorities
▪ Improvement Trust
▪ Primary Coops
▪ Developers/Private
sector builders
▪ Building Centers /
Panchayats

(Dwivedi,Urban Development and Housing in India 1947-2007)

68