Why pay for something that doesn’t exist?
Vague super area specifications could be helping developers dupe buyers investing in their housing projectsrealestate Updated: Jun 29, 2013 19:13 IST
When we buy an apartment in a group housing project we pay for it on the basis of super area (the sum of the actual wall-to-wall or covered area and the common areas used by all residents of the projects, such as lifts, corridor, stairwells, clubhouse, gym, etc).
What we are not, however, given is the exact specification of the super area in which we have undivided share. Readers will be surprised to know that there are several projects in Delhi NCR in which developers have earned huge profits by selling unsuspecting buyers ‘virtual’ super area - which is neither defined properly nor detailed anywhere on paper or on the ground.
In an actual case investigated by HT Estates in Faridabad, it was discovered that a real estate developer had got the approval from the director general, town and country planning (DGTCP) to build over 17.71 lakh sq ft area in 2006. Five years later, in 2011, when he applied for a completion certificate to the DGTCP, the developer gave a declaration that he had constructed 1200 units of 2 BHK utilising 12.71 lakh sq ft of the total area and was left with 5 lakh sq ft, which is 17.71 lakh minus 12.71 lakh.
Interestingly, in the same project, he sold 627 units of 3 BHK each of about 1500 square feet, which means that he has covered 1500x627, which is equal to 9.4 lakh sq ft.
The question is, how could he build over 9.4 lakh sq ft when he was left with just 5 lakh sq ft area for construction?
Where has the excess 4,.4 lakh sq ft area come from? It is all about fudging numbers and giving vague specifications of the super area. The developer had misrepresented facts. The actual area on which he had constructed the buildings was much less than the super area specified by the developer.
“If the actual measurement of my flat is 1400 sq ft (including the covered area as well as the undivided share in the common area), the developer sells it as 1600 sq ft - and does not account for the 200 sq ft of extra space. Today selling flats on the basis of super area has become a legitimate way to rob homebuyers,” says Ashish Kaul, an RTI activist who has bought a flat in the project being investigated.
The arithmetic boggles the mind. “If we presume that the developer is selling his apartment at R4000 per sq ft, the profit he makes, after multiplying R4000 with 4.4 lakh sq ft is a whopping R176 crore. This is just shocking,” adds Kaul.
When HT Estates contacted the developer, the response of a senior official who did not want to be named was as baffling as his method of super area calculation.
“When we give our layout plan to the competent authority, we declare the details of the total area we will cover, both vertical as well horizontal. This constitutes the covered area of all the flats and walls as well as the area of the common facilities like the club, etc. So we declare the total built area. But there are other areas which are not part of the built area, such as the open balcony area, etc. But this open balcony area is included while calculating the super area of an apartment. So when you calculate the super area of each flat, its sum exceeds the built-up area,” he says.
As a result, “whenever a prospective homebuyer purchases a flat of 1600 sq ft super area, the covered area is normally 20% to 30% less than that, ie, between 1100 sq ft and 1300 sq ft. The rest is his undivided share in common area as well as the other areas such as balcony etc.”
Contradicts Kaul, “By no calculation can the total balcony area of 1827 flats (1200 sq ft plus 627 flats) add up to 4.4 lakh sq ft. This is how developers cover up their fraud.”
To avoid being duped a homebuyer first needs to find out the exact specifications of his share in the common area of his group housing project. Corridors, passages, staircase, underground/overhead water tanks, space above the stairwell, entrance lobbies, electric sub-stations, pump house, guard rooms and other common facilities are part of the common area.
So it’s difficult to determine an individual’s share in the undivided common area in a housing project populated by 2000 to 3000 residents.
This becomes more complicated when a developer claims that balconies etc, which are not part of the built-up area, have been included in the super area.
The other real estate destinations in Delhi NCR too share a similar story. Take the case of Amit (name changed) who bought a 3 BHK measuring 1625 square feet (super area) in 2008 in a prominent group housing project in Noida. The total area of the same flat was shown as 1297 sq ft in the layout plan of the project approved by the Noida Authority.
When all the flats were constructed, the Authority allowed the developer to increase the FAR (floor area ratio) from 1.5 to 2. It means that the developer can add more floors to the towers or can cover more land for construction but surprisingly in the new layout plan submitted to the Authority, Amit’s 3 BHK flat, which was already constructed before availing increased FAR by the developer, was expanded to 1326 sq ft.
That’s not all, when he got his flat registered in 2013, the sub-lease deed showed the covered area as 1186 sq ft and common area 439 sq ft - totaling 1625 sq ft. “I don’t have the exact specifications of my flat - or if ot covers 1297 sq ft, 1326 sq ft, 1186 sq ft or 1625 sq ft. All I know is that I have paid for 1625 sq ft,” he says.