We have all heard of those stories. When you are promised an apartment or a house at a price that seems too good to be true? You think that you have THE deal of your life only to find out that what you saw is not what you really get. In the past, developers could mislead homebuyers by selling a property under built-up or super built-up area. But now we have the Real Estate (Regulation and Development) Act, 2016 or RERA as it is popularly known in effect, and things are changing.
RERA allows developers and builders to promote their properties only on carpet area, bringing in more transparency in the whole process of home buying.
Different ways of calculating the area of a property
Property size can be calculated in three different ways:
- Carpet area
- Built-up area
- Super built-up area
In simple terms, carpet area is the net usable area of a property, wherein one can spread a carpet, calculated from the inner walls of the house.
The built-up area includes the carpet area plus portions of the property approved by the authorities like the dry balcony area, inner and outer wall, and ducts. This is usually 10% more than the carpet area.
Super built-up includes the carpet area, the built-up area, as well as the area used as a shared resource in a building like stairs, lobbies, corridors, and awnings. This is usually 25% more than the carpet area.
In the past, developers could fool sellers by quoting a price based on the built-up or super built-up area. A regular homebuyer may not have known about terms like the carpet area, the built-up area or the super-built up area.
Consider this example. In the past, developers could sell an apartment as having a saleable area of 1,400 sq.ft when the carpet area was just 1,000 sq.ft. More money from the homebuyer, but not necessarily resulting in a bigger apartment! Now, according to the new mandate, a seller can only charge a buyer for the carpet area.
Here’s how that helps:
Using carpet area as the standard will allow the buyer to know the exact usable area and allow him to analyse the price per sq. ft. It also becomes easier for the buyer to compare and contrast apartment areas across projects in the same market and make an informed decision before making the life-changing decision of buying a house.
A home buyer would know the exact price he is paying for the property of his dreams and the exact area he is will receive that payment. Now, for that, it is time to roll out the red carpet!
