On March 11, a reputed newspaper published an article — ‘It’s no lottery: BDA doubles flat rates’. The article stated that applicants who had been allotted 2 BHK flats by the BDA as part of its low-cost housing scheme, had started receiving notices from the BDA, informing them that they had to pay Rs 10 lakh over the original cost price of Rs 7.5 lakh, and those who had been allotted 3 BHK flats should expect to receive notices to pay an additional Rs 15 lakh.
The article obviously caused a furore among those who had been allotted flats so far. Needless to say, a hike of almost 130% in the cost price of the flats, was not something that any of the allottees anticipated, especially considering that they had applied under BDA’s low cost housing scheme.
After the 2nd notification calling for application, the BDA did send a notice to applicants informing that the price of the flats would be increased as they had wrongly estimated the cost of the flats. Most applicants agreed to this increase and even paid the additional security deposit.
While those who have been allotted flats, seem to be happy considering that they are or will be proud owners of a flat in Bangalore, this has not gone down too well with those who had applied as early as 2011 and are yet to get an allotment.
The article has obviously caused a significant amount of panic. For many citizens of Bangalore, the BDA’s foray into flats was an opportunity to be able to afford a house of their own, even if it meant that they would need to take a loan and pay off the amount over a period of time. For them to be informed that the price would further increased by approximately 2.5, 10 and 25 lakhs for one, two and three BHK flats respectively would have come as a shocker.
A comment by a citizen on one of our previous articles stated that the BDA had increased the prices of flats from 14.5 to 17.6 lakhs, for those who had applied in the first notification, and that he was concerned about the possibility that BDA could further increase the cost to 25 lakhs as per the fourth notification, in the future. And the BDA did increase prices in its fourth notification.
To validate the story, Citizen Matters spoke to BDA Engineer, Gowdaiah N G. He said, “The story has no basis. It seems to be fabricated by the media, in collusion with private builders and other parties with vested interests. The BDA will not be increasing the price of the flats that have already been allotted as mentioned in the article. That is absolutely false!”
With respect to allottees’ reaction to the article, Gowdaiah added, “So far around 10 people have approached me enquiring about the price hike and I have had to tell them that it is not true. It is not right to create a situation of panic like this.” In fact, even as Citizen Matters spoke to him, Mr Gowdaiah said that there was an architect who was in his office enquiring about the same.
BDA clarifies the issue
A press note from BDA clarifies that the first notification had marked the EWS category flat (income within 1 lakh) of 385 sq ft for 5.5 lakh. However, the response to this was not very encouraging. In the next notification issued in September 2011, the BDA advertised 1 BHK, 2 BHK and 3 BHK flats. There was the basic model of 250 sqft, premium model of 350 sqft and deluxe model 450 sqft meant for EWS category. The price was 3.75 lakh, 5.5 lakh and 7.5 lakh. Similarly for low income group the amount was 7.5 lakh, 10 lakh and 12 lakh. Similarly in 3 BHK, the basic, premium and deluxe models were priced at 13 lakh, 16 lakh and 18 lakh, with an area of 900 sqft.
But the BDA claims there was not enough response to this notification too. Because of this, the BDA decided to improve the quality of materials used and revised the price again, in March 2013. BDA decided to increase the space of 1 BHK to 470 sqft, 2 BHK to 830 sqft and 3 BHK to 1100 sqft.
With the increase in the area, the price was also increased. EWS category flats were priced between 7.5 lakh to 8.2 lakh in various areas, while for general quota, 1 BHK flats were priced between 9.5 lakh and 11.2 lakh. 2 BHK flats were priced between 14.5 lakh to 17.6 lakh, and 3 BHK flats were priced at 23 lakh to 27 lakh. BDA says that this price was announced in March 2013.
Failure to communicate results in confusion
BDA claims that all the applicants were informed about the rise in the price and their assent was sought before allotting the flats.
The confusion was created by some applicants who had applied in 2011, and were allotted 2 BHK flat in February 2014. One of the applicants claimed that she had applied under EWS category, however, according to BDA, the EWS category didn’t have 2 BHK flats, as per its latest notification issued after revision – in March 2013.
BDA’s failure to communicate the revision to all applicants resulted in confusion and misinformation. However, some buyers point that when compared to private housing schemes, the BDA flats still remain a lot cheaper and superior in quality.