Reviving Maharashtra’s Old Buildings: Government Push for Self-Redevelopment

Societies Gain Power With Incentives To Lead Redevelopment Projects

In a landmark decision, the Maharashtra government issued a Government Resolution (GR) on 13 September 2019 aimed at encouraging cooperative housing societies to undertake self-redevelopment instead of relying on private builders. This move empowers societies, protects members’ interests, and ensures faster completion of projects.

Why Self-Redevelopment Was Needed

For decades, old and dilapidated buildings in Mumbai and across Maharashtra have been redeveloped primarily through private builders. While builders enjoy most of the benefits, including higher FSI (Floor Space Index) and profits from selling extra flats, society members often receive little beyond a slightly bigger flat. Worse, many projects stall mid-way due to disputes or financial troubles, leaving residents in limbo. Homebuyers who invested in such projects through loans also face severe hardships.

Recognising these problems, the state decided to promote self-redevelopment, where the society itself takes charge of rebuilding. This ensures members retain control, enjoy additional benefits, and safeguard their homes without depending on external developers.

Key Benefits Announced

The GR lays down several incentives and reforms to make self-redevelopment smoother and more attractive:

1. Eligibility – Societies with buildings 30 years or older can apply for self-redevelopment.
   
2. Single-Window Clearance – All approvals will be granted through one office within 6 months, eliminating red tape.
   
3. Extra FSI – Eligible societies will get 10% more FSI than normal redevelopment projects. For narrow roads, FSI is increased from 0.2 to 0.4.
   
4. Relaxed Road Rules – Instead of two access roads, one road (9 m in congested areas, 12 m in less dense areas) is sufficient.
   
5. Discounted TDR – Societies can purchase Transfer of Development Rights (TDR) at 50% lower rates.
   
6. Tax & Fee Concessions – Waivers on LUC Tax (if completed on time), reduced stamp duty (₹1,000 for member agreements), and GST relaxations.
   
7. Loan Subsidy – Government provides a 4% interest subsidy on loans for self-redevelopment projects.
   
8. Strict Timeframe – Projects must be completed within 3 years of approval.
   
9. Monitoring & Accountability – A vigilance committee of society members, bank representatives, and experts will oversee progress every 3 months.
   
10. Tri-Partite Agreement – Mandatory agreement between society, contractor, and bank ensures transparency and accountability.
    
11. Grievance Redressal – Special district-level committees will address complaints and disputes quickly.
    
12. Contractor Rules – Only financially strong and technically capable contractors (verified by authorities) can be appointed.
    
13. PMAY Linkage – If societies reserve 35% of flats for EWS/LIG groups, they get additional benefits under Pradhan Mantri Awas Yojana, including higher FSI and a subsidy of ₹2.5 lakh per beneficiary.
    

Why This Matters

This decision marks a major shift in Maharashtra’s housing policy. Instead of being dependent on builders who prioritise profit, societies now have the tools, incentives, and legal framework to control their own redevelopment. It addresses three chronic issues:

• Delays & Abandoned Projects – Strict monitoring ensures timelines are followed.
  
• Financial Exploitation – Subsidies, discounted TDR, and lower taxes reduce costs for members.
  
• Equitable Benefits – Members, not builders, enjoy the gains of additional FSI and government incentives.
  

The Road Ahead

While the policy is ambitious, execution will be key. Societies need awareness, financial discipline, and professional guidance to handle complex redevelopment processes. Banks, nodal agencies, and municipal bodies will play a crucial role in ensuring transparency and timely support.

Urban planners believe this model could reshape Mumbai’s skyline by replacing crumbling buildings with safer, modern homes while keeping control in the hands of residents. If implemented effectively, self-redevelopment could become a model for other Indian states facing similar housing challenges.