High maintenance cost for MHADA flats dejects buyers
Mumbai experiences a dearth of housing options, especially among the middle and lower income groups. The houses sold through MHADA lottery 2011, confirms the fact getting an affordable housing for the lower income groups in Mumbai is a hard nut to crack. High maintenance cost of such buildings offered by MHADA stands as one of the repelling reasons for home buyers and look for other options.
As a relief for residential options to the lower and middle income groups, earning between Rs 8000-RS 20000, Maharashtra Housing and Area Development Authority offers houses in bulk in annual lottery to its citizens. Such houses are offered at reasonable rates to suffice the non-high class group buyers. However, the bulk houses sold in 2011 lottery did not suffice the lower segment of buyers, since half of the homes were designed for HIG housing, ranging between Rs 6800 per sq ft to Rs 15000 per sq ft.
What did not work for MHADA
The sudden increase in the prices of the houses, compared to the previously mentioned rate in the brochure did not work in favor of MHADA. For instance, MHADA charged an additional sum of Rs 10 lakh-Rs 15 lakh from its buyers for one of its housing project in Powai (which is close to Hirananadi Complex).
The extra money levied additional burden on the buyers and made it difficult for them to avail the property. Such instances are hindering the faith of home buyers in MHADA projects that has led to reduction of investors in the due course.
To make matters worse, the maintenance cost of MHADA buildings is much more that is likely to discourage home buyers. Maintenance costs for such buildings ranges between Rs 5400- Rs 6700 per month. Leving of such costs takes a toll on the monthly expenses of the middle and lower income buyers significantly.
Role of Property Tax
The property tax on such MHADA buildings is much higher, in comparison to other towers of private developers. While implementing the property tax, the civic body takes into consideration a number of essential factors including- type of construction, age of property, floors and user type. In accordance with the new system, property tax will be evaluated on ready reckoner rate or capital value rather than the rental value.
Examples
MHADA has allotted flats to around 3000 people in Kandivali and Malad area, at subsidized prices in its annual lottery of 2011. However, the monthly maintenance costs that ranges between Rs 5,480 to Rs 5,328, stands out as one of the biggest reasons for low income buyers to worry. Moreover, half of such flats are sold to high income groups (earning more than Rs 40000 per month) at Rs 55 lakh and more. The maintenance costs of such houses ranged between Rs 6700 to Rs 7000 per month.
The prices of the houses quoted by MHADA are much higher, compared to the rate offered by private developers. To add to it, in the last few years, MHADA has been unable to hand over the possession of houses on time, adding to the inconvenience of the lottery winners. Such reasons have made MHADA lose its credibility among the buyers.
