In today’s world, having any doubts about the concept of the carpet area could be extremely detrimental to a home buyer. Despite the numerous nitty-gritty details involved, it all boils down to the space that the buyer will acquire in exchange for money. This is why space calculations are the single most important determinant of a property’s value.
Since the real estate law made it mandatory for them to sell homes based on carpet area, almost all major real estate developers have promoted the large carpet area offered by their units as a unique selling point. The larger the space, the higher the cost. Similarly, the smaller the space, the lower the cost.
While it is much easier to calculate if you are purchasing a piece of land or a plot, the same cannot apply to flat/apartment purchases. It is more difficult to have a precise idea about the space measurement in constructed units, which is a fact that real estate developers in India have widely abused by misinforming buyers. That was true before the Real Estate (Regulation and Development) Act of 2016 (RERA) went into effect.
As how much you spend on your property purchase is heavily influenced by how much space the builder provides you through the flat or apartment, it is critical that you are familiar with the various space-measuring benchmarks – carpet area, built-up area, and super built-up area – that are commonly used in real estate transactions in India.
What is carpet area?
Let us first define carpet area, a term that real estate developers are required to use when providing buyers with information about the size of a property. This is very literal and easy to understand. The carpet area is the area in the flat or apartment that you could cover with a carpet.
What does carpet area include?
This means that the carpet area is the actual usable area in your home. This means that the carpet area of the apartment will not include the thickness of the inner walls, the space used to construct the lobby, elevator, stairs, play area, and so on.
Formula to calculate carpet area
Carpet area = Area of bedroom + living room + balconies + toilets – the thickness of the inner walls
Definition of carpet area under RERA
Section 4 of the RERA says that every promoter shall make an application to the real estate regulatory authority, for registration of the real estate project, while providing, among other things, the carpet area of apartments for sale in the project, along with the area of the verandahs or exclusive balcony and the exclusive open terrace areas with the apartment.
While clearly prescribing real estate developers to sell apartments and flats in India based on this space-measuring benchmark, the real estate act (RERA) defines the carpet areas as “The net usable floor area of an apartment, excluding the area covered by the external walls, areas under services shafts, exclusive balcony or verandah area and exclusive open terrace area, but includes the area covered by the internal partition walls of the apartment.”
The Act also explains that the expression ‘exclusive balcony or verandah area’ refers to the area of the verandah or balcony, as the case may be, which is appurtenant to the net usable floor area of an apartment, meant for the exclusive use of the allottee. Additionally, according to the Act, ‘exclusive open terrace area’ refers to the area of that open terrace that is appurtenant to the net usable floor area of an apartment, meant for the exclusive use of the allottee.
What is covered under the carpet area?
- Bedroom
- Dining room
- Dressing room
- Kitchen
- Study
- Stores
- Any other room
- Bathroom
- Balconies within the house
- Staircase within the house
What is not covered under the carpet area?
- External and internal walls
- Common areas
- Terrace
What else does RERA say about carpet area?
While builders are now required by law to mention the carpet area when measuring and pricing units, provisions have also been made for the increase and decrease in its measurement while developing an under-construction project. If the carpet area is reduced during construction, the builder must refund the excess amount to the buyer within 45 days, with annual interest. In the event of an increase in carpet area, the developer may also require the buyer to pay the difference. The RERA, on the other hand, limits the maximum increase in carpet area to no more than 3%.
How to make sure you are not short-changed in terms of the carpet area?
If you are purchasing a project in a mega housing society, the builder has been ordered by RERA to disclose the carpet area of the unit. However, you should hire a technical expert to come to the flat and calculate the area. If you apply for a home loan, the bank will send a technical expert to inspect the property. Check with them to see if the carpet area the builder told you is the same as what they assess. If there are any discrepancies, you must notify the builder and renegotiate the price.
Another important thing to remember when buying a home is not to get carried away by built-up area or super built-up area numbers if the carpet area is not to your liking. At the end of the day, the carpet area is what you will be using in your daily life. The carpet area must take the highest percentage among the three numbers.
What is built-up area?
The carpet area plus the area covered by the inner walls and the balcony constitute the built-up area in your flat or apartment. In India, nearly 30 percent of the total area of housing utilized to construct the inner walls and balconies. This means that if the developers tell you that the built-up area of the units is 1,000 square feet, you can safely assume that the net usable area or carpet area of the apartment will not exceed 700 square feet.
Formula to calculate built-up area
Built-up area = Carpet area + area of walls + area of balcony
What is covered under built-up area?
- Carpet area
- External and internal walls
- Utility ducts
What is typically not included under built-up area?
- Courtyard at the ground level
- Garden
- Rocky area
- Well and well structures
- Plant
- Nursery
- Platform around a tree
- Overhead water tank
- Fountain
- Bench with open top and the likes
- Drainage
- Culvert
- Conduit
- Catch-pit
- Gully pit
- Chamber gutter
- Compound or boundary wall
- Uncovered staircase
- Watchman booth/pump
- Sump tank
What is super built-up area?
A housing society consists of several common areas. While the buyer must pay a monthly maintenance fee for the upkeep of these areas, he must also pay for a proportionate portion of these spaces at the time of purchase. To arrive at the super built-up area, builders typically use the loading factor–constructed spaces not exclusively allocated to the buyer. The super-built-up area of a unit calculated by adding the total built-up area to the area occupied by common areas such as the corridor, the lift lobby, the elevator, and so on. In some cases, builders include amenities in the common area such as pools, gardens, and clubhouses.
Prior to the RERA making it mandatory for builders to sell flats based on carpet area, they frequently used the super-built-up area as the space-measuring unit, capitalising on the lack of clarity on space calculation. They were able to reduce the cost of the property per square foot by using super built-up area as the measuring unit. It also gave the buyer the impression that they were purchasing a large home when they were not.
The large number that developers prefer to market their projects with is super built-up area. It is the figure they arrive at after combining common and built-up areas. The saleable area also known as the super built-up area because it serves as a yardstick for developers to quote their buyers. With more than one apartment on a floor, the calculation of a super built-up area takes place differently.
Assume a 1,000-square-foot house costs Rs 2,000 per square foot. In this case, the total cost of the property will be Rs 20,00,000. A developer will provide the super built-up area (say, 1,300 sq ft) and price the property lower at, say, Rs 1,800 per sq ft to make the marketing pitch even more appealing. In this case, the total cost of the property is Rs 23.40 lakhs. To a naive buyer, the latter would sound far more appealing than the form.
What goes on in the super-built-up area?
- Built up area of the flat
- Clubhouses
- Air ducts
- Pipe / shaft ducts
- Lift
- Staircases
- Lobby
- Swimming pool
- Gymnasium
- Any other common facilities
Please note: the builder will add space to the carpet area based on the loading factor used by the builder.
Formula to calculate super built-up area
Super built-up area = Built-up area + proportionate common area
Or
Super built-up area = Carpet area (1+loading factor)
Note: The loading would be in the range of 15% to 50%, depending on builder and the exact location.
Super built-up area calculation example
The super built-up area of a floor changes depending on the number of apartments on the floor.
Let us assume that on the fifth floor of a housing society, Sanjay Mehta owners an apartment with a built-up area of 1,000 sq ft. On the same floor, Amit Lal owns an apartment with a built-up area of 2,000 sq ft. The total common area on the floor is 1,500 sq ft.
Now, to calculate the super built-up area of the two apartments, the builder would divide in the ratio of the apartments’ built-up areas (in this case 1:2) add 500 sq ft extra space in Mehta’s total built-up area and 1,000 sq ft extra in Lal’s built-up area. Now, the super built-up area of Mehta’s apartment is 1,500 sq ft and Lal’s is 3,000 sq ft.
Can buyers refuse to pay for an increase in carpet area by the builder?
There have been several cases where the builder raises the overall price of the property due to changes in the plan and an increase in carpet area. RERA provisions require the buyer to pay the additional charges. The Maharashtra RERA recently stated that the buyer is obligated to pay the extra money in a case filed by Ashley Neil Serrao and Mark Clement Serrao, who purchased a unit in Runwal Greens from Propel Developers Pvt Ltd.
The MahaRERA order stated that “the increase in carpet area is being charged on a proportional basis with respect to the consideration price of the apartment and that being covered in the agreement for sale, cannot be termed as a breach of the agreement for sale.”
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Tips to calculate the usable area of your future house
Always inquire about the carpet area of the property and base your price negotiation on this figure. To ensure that there is no room for error on this front, you could hire a private technical assessor to re-confirm the carpet area in the property. Those who purchase a home with the help of housing finance are in a better position because the bank will send its own legal and technical assessors to inspect the property’s specifications.
Another thing to keep in mind here is that even if a builder quotes the property price based on the carpet area, they will usually increase the per sq ft cost to account for the built-up and super built-up area. Look for similar projects in your area to see if the builder’s quote seems reasonable. If not, the buyer can negotiate the deal and try to get the prices reduced.
