Gurgaon to lead residential supply in Delhi NCR
The hike in Floor Area Ratio (FAR) in Gurgaon is expected to make the city lead Delhi in the supply of residential inventory. Currently, Gurgaon hosts 24 per cent of the total housing supply in Delhi NCR, slightly lower than Delhi (data by 99acres).
The Millennium City, Gurgaon has established itself as a coveted residential destination over years. The growing commercial bases along with evolving connectivity to the capital city have resulted in a large population to swarm this city. According to the data available with 99acres, in the entire National Capital Region, Gurgaon holds the highest residential inventory after Delhi. Availability of land parcels and burgeoning job opportunities add to its prospects to cater to the rising housing needs. In order to tap the city’s potential further, the Haryana Government has hiked the FAR by 0.35 to 0.80, depending on the plot sizes. Experts say the move will bring Gurgaon ahead of Delhi and it will soon lead the residential supply in NCR.
Based on the new FAR rules, a 100 sq mt plot can now have up to 200 sq mt (FAR of 2) of construction instead of the earlier 165 sq mt (FAR of 1.65). Although the revised rule stands only for licensed colonies and Haryana Urban Development Authority (HUDA) sectors, it is expected to enhance the availability of homes in the city, without consuming additional land space. Some of the sectors included under HUDA in Gurgaon include Sectors 4, 5, 7, 9, 10, 14, 17, 18, 21, 22, 27-34, 38-47, 49, 50, 10A, 12A, 15I, 15II, 18Elec, 22B, 23-23A, 37I and 37II amongst a few others.
Gurpreet Singh Sachdeva of Sachdeva Associates says, “A hike in FAR will trigger vertical growth and thus, Gurgaon could definitely help Delhi meet its growing housing needs. Additionally, the premium levied for purchasing additional FAR could be a great revenue generator for the government and would help in enhancing the infrastructure in the area.”
Currently, Gurgaon showcases a huge disparity in supply of various property types. Residential apartments capture more than 60 per cent of the total market share. Supply of independent houses/villas and builder floors is restricted to seven and 16 per cent, respectively. “With the purchasable FAR available now, the supply dynamics are anticipated to change and there could be an increased supply of independent houses and builder floors in Gurgaon,” adds Singh.
The ruling is applicable not only in Gurgaon but also in Faridabad. The city currently captures hardly one-tenth of the total residential inventory in Delhi NCR. The sectors which would enjoy the benefit of the ruling in Faridabad include HUDA Sectors such as 2-9, 12-21, 24, 25, 27-31, 37, 44-48, 55, 56, 58, 59, 62, 64 and 65.
While the capital region will witness a marked change in the supply dynamics, the new rule could also have a bearing on the average price movement over the subsequent quarters and years. While the piling unsold stock of residential apartments may crumble property rates across zones, growing supply of independent houses and builder floors may lead to plateauing values, at least in Gurgaon and Faridabad.