Property developers in Mysore are seeking a revised Floor Area Ratio (FAR) in a bid to increase land usage which will have a bearing on the cost of apartments currently reckoned to be on the higher side.
The FAR is the ratio of the built area to the total size of the plot and varies from city to city. However, members of the Builders Association of India, Mysore, and Confederation of Real Estate Developers Association of India (CREDAI) local chapter are trying to impress the authorities to raise the FAR from the prevailing 1.75 to at least 2.5 or more.
Immediate benefit
“An immediate fallout of the increase in FAR will be a dip in property cost as the cost of land tends to be inversely proportional to the floor area ratio and builders will have the flexibility to add more floors and thus divide the cost of construction among more number of consumers. The end-users will get an immediate benefit ranging up to 30 per cent and this will also help prop up the construction industry while fuelling demand for ready-to-occupy property in Mysore,” said Naga Kumar of Premier Properties.
Speaking to The Hindu PropertyPlus , M.B. Naga Kumar, Managing Director, Premier Properties and President, CREDAI-Mysore, said the issue of revising the FAR for Mysore is long pending and has remained frozen since 1996. The authorities have been impressed upon the need to rejig the floor area ratio in the revised Master Plan for Mysore slated for release in due course.
It was pointed out that most cities in Karnataka have a higher FAR ranging from 2.25 to 2.5 as in Belgaum while it is 3.25 in Bangalore. The low FAR is reckoned to be one of the reasons why the cost of apartments in Mysore is perceived to be very high, almost matching those in Bangalore.
While the apartment costs match that of property in Bangalore, the rental yield in Mysore is low and hence potential investors in the property segment have started questioning the wisdom of putting in their money in Mysore as the returns are low. For the same cost, they can acquire property in Bangalore where the rentals are much higher.
“A better FAR would have helped us utilise the land more efficiently and unless this changes, apartment growth will remain sluggish,” according to other members of the CREDAI in Mysore.
Apart from a revised FAR, property developers are also seeking a re-look into the issue of taxation, according to Naga Kumar. At present, any sale related to apartment or property entails on the consumers to pay VAT, service tax, stamp duty as also registration fee. “The Government should levy either VAT or stamp duty but not both,” say the developers but this is in the realm of policy issues and has remained unchanged.
While the FAR remains a sensitive issue in Mysore given its heritage status, property developers have pointed out that no new construction can come up in the existing heritage zone around the palace and other important structures. The new development is on the fringes of the city and the residential areas and hence the authorities should revise the FAR for construction in such areas.
The argument in favour of a revised FAR is also used to underline the imperatives of preventing the horizontal urban sprawl that is eating up the agriculture land in the hinterland.
