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Buyers of layouts, beware!

G.V.Prasada Sarma
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It's the huge variation in price that tempts prospective buyers to take interest in unauthorised layouts, writes G.V.Prasada Sarma

The lure of plots at a cheap rate is irresistible. Glossy brochures announcing that one can have a roof over one’s head for price ranging as low as Rs.1 lakh or even less attract potential buyers.

The brochures describe their respective ventures attractively describing their location as being close to a developing hub in the vicinity and cataloguing all the developments really taking place, planned or just being talked about.

The problem with such layouts in a city and its vicinity that has experienced real estate boom for a pretty long time is the investment part of it. Apart from those who are genuinely interested in constructing a house there at some point of time in the future, there is another section that buys it from a sheer investment point of view.

“The price difference between a plot of land in an unauthorised layout and the one fully developed may sometimes be as high as three-times,” say knowledgeable sources.

It’s the huge variation in price that tempts prospective buyers to take interest in unauthorised layouts. Besides the practice so far has been that after housing is developed basic infrastructure for layouts like roads and drains come that leads one to buy in such layouts.

The various taxes levied for layouts, like development charge, open spaces charge, NALA charges etc form 30 per cent of the land cost. That itself is a huge amount considering the spiralling land cost of late.

For someone looking for plots at a cheap rate and the developer opting for the easy way out it appears to be a win-win situation.

Big trouble

But it is a perfect recipe for unplanned urban growth. In the Visakhapatnam Metropolitan Region nearly 300 layouts have been identified as unauthorised. Some of them have come into existence around the time when the VUDA purview has been extended bringing under it a staggering 5,573 km from Tuni in East Godavari district to Amadalavalasa in Srikakulam district in mid-2008.

The unauthorised layouts mostly came in the semi-urban areas that have become a part of VMR region with developers getting wind of the move. It is projected that over a period of 30 years the entire area would be urbanised. The layouts identified as unauthorised range between 5 acres and 10 acres. In the transition period, the layout approvals are neither obtained from the Director of Town and Country Planning (DTCP) nor from VUDA.

A big loss for those who have developed/invested in the unauthorised layouts is likely with the VMR Master Plan and zone development plans being prepared afresh. Several factors like development in tank bed, beside tanks, over high tension lines, in the proximity of gas pipeline etc. will make the layouts ineligible for approvals.

With the Layout Regularisation Scheme (LRS) coming to an end after a long period of five years with several extensions and the government making it clear that it would not be extended again, the future of such layouts hangs in balance.


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  • In the Visakhapatnam Metropolitan Region nearly 300 layouts have been identified as unauthorised.



  • 2

  • It is projected that over a period of 30 years the entire area will be urbanised.



  • 3

  • In the transition period, the layout approvals are neither obtained from the Director of Town and Country Planning nor from VUDA.



  • 4

  • A big loss for those who have developed/invested in the unauthorised layouts is likely with the VMR Master Plan and zone development plans being prepared afresh.



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