HDFC chairman, Mr. Deepak Parekh, criticized developers for their lack of clarity regarding the distinction between super built-up area and carpet area in the properties they sell. He pointed out that developers often mislead buyers by basing sales on super built-up area without clearly specifying the actual carpet area. In Delhi, while authorities are supposed to adhere to the recommendations of the new Master Plan of Delhi 2021, enforcement remains lax.
Mr. Anuj Puri, chairman and country head of Jones Lang Lasalle Meghraj, elaborated on the complexities of the issue. "Building bylaws and regulations differ from state to state and even city to city. However, it invariably turns out that property buyers are required to pay for construction that falls in FSI-free areas—areas of congregation, passage, and common conveniences. In a typical project, these areas do not tend to constitute more than 15-20% of the overall FSI. Nevertheless, all that a buyer would really wish to pay for is the exact amount of space available for personal use in the property, in other words, the carpet area”.
Mr. Puri explained the rationale behind including wall space in the built-up area. He stated that a house cannot exist without walls, therefore, the buyer inevitably pays for the space these walls occupy. "This is, of course, unavoidable," Mr. Puri contends. He further illustrated his point with an example of how extra charges accumulate in property purchases across the country. If a developer sets a base rate of Rs 2,500 per square foot and a buyer is interested in a 1,250 square foot apartment, the initial calculation puts the apartment's value at Rs 31.25 lakh. However, Mr. Puri emphasized that this figure omits parking charges, maintenance charges, and any applicable preferential location charges, ultimately resulting in a higher final price for the buyer.