Hike in TDR prices will hugely benefit government

Q: The market is running with a belief that FSI will go up, and that the option to buy additional TDR is beneficial for Mumbai real estate companies. Is that belief correct?

Sangyukta Mishra,

11th December 2015

Property Tax in Mumbai

fsi

floor space index

tdr

transfer of development right

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Replies (2)

Yes, earlier, TDR was available like any other commodity. It could be used anywhere in any part of Mumbai. The price was neutral. Demand and supply were the guiding factors. But today, it is very clearly differentiated based on RR rates.

Sandeep Mhatre, Mumbai

11th December 2015

Comment

So, this may ascertain availability but the pricing will remain high. So, it is not a net positive for Mumbai real estate companies?

Sashidharan,

11th December 2015

Yes, that is true, but the government will be a big beneficiary of this. Earlier the TDR prices were normally about 20% to 30% on the Ready Reckoner rates. Now they have made it 60% of the Ready Reckoner rate.

Sandeep Mhatre, Mumbai

11th December 2015

The increase of % of sale of TDR by the govt.against the premium is another mode of making TDR available to builders. Earlier there was one base FSI on the land in suburbs, and one on TDR. That one TDR is matter of demand and supply. Similarly, pricing is a matter of demand and supply too.

Sashi dhar, Ghaziabad

11th December 2015

Comment

Hi Sashi,
But at the same time, the rate they have fixed as the standard for premiums for TDR which is 60% of the Ready Reckoner rate segregate much between areas based on TDR consumption.

Sashidharan,

11th December 2015