DDA to make buying flats easier, may use PPP route

The Delhi Development Authority (DDA) is reviewing the eligibility criteria for allotment of flats offered under the agency’s housing schemes that allows one person to bid for just one unit, as the authority is looking to augment sales by attracting more buyers.

The clause was added to provide affordable housing to a larger part of the city population as well as prevent hoarding. However, with an inventory of thousands of unsold flats, the land owning agency is now planning to do away with the condition.

“The regulations were drafted in 1968 when affordable housing for all was DDA’s mandate. Since then, the city has changed a lot and NCR cities such as Noida and Gurugram have opened up a host of housing choices to the people. As the demand for DDA flats has dropped, such stringent conditions only pushes buyers to other markets. We are reviewing this criteria now. We will send a proposal to the Union ministry of housing and urban affairs (MoHUA) once it is approved by the authority,” said a senior DDA official who asked not to be named.

DDA (management and disposal of housing estates) regulation, 1968, were issued under section 57 of DDA Act, 1957. Regulation 7 of these rules detailed eligibility of allotment of the flats.

It stated, “A dwelling unit or flat in the housing estates of the authority shall be allotted only to such person who or his wife/husband or any of his/her dependant relations including unmarried children do not own in full or in part on freehold or leasehold basis a residential plot or house in the urban area of Delhi, New Delhi and Delhi Cantonment.”

In March, MoHUA approved relaxations to these norms in developing areas — where more than 25% flats remain unsold six months after they are put up for sale. Now any person having a plot or flat of less than 67 square metres is eligible to apply for allotment of newly constructed DDA flat.

However, the DDA now wants to completely remove this rider allowing everyone to apply for the available flats, irrespective of property ownership. Officials said that relaxation in norms will boost sale by broadening the buyers bracket.

Projects on PPP mode

DDA is also considering launching all new residential schemes on Public Private Partnership (PPP) mode.

So far, the authority has not partnered with any private firm for housing projects. “We realised that PPP may be way going forward as we are unable to generate profits from the flats, most of which are now being sold as vintage flats. A private developer may be able to help reduce cost and generate more buyer interest. However, we are still discussing feasibility of the proposal,” said the official.

Meanwhile, experts said that increasing housing liquidity has been a persistent issue in Delhi and private partnership may benefit residents as well as DDA.

“This recent amendment will offer flexibility to the lower income communities to upgrade, and will help fill housing vacancy. Also, permission to amalgamate flats under the latest housing scheme allows the buyers to own a bigger house at an affordable price. However, there is a need to address the issue of insufficient housing supply within the city. Considering Public Private Partnership (PPP) model to cater to this problem is a promising step as it brings in the required finances, technical expertise and deeper understanding of market dynamics. A successful PPP model will require careful consideration at each step of the project — pre-construction, mid-construction and post-construction phases. Each phase will require careful planning and adequate risk coverage for challenges around land availability, raw material costs, financial flow, payments related risks, various authority approvals, suitability of developer entity, change in market uptake, inflation, among other things,” said Prerna Mehta, associate programme director, World Resources Institute India.