How Good Is The DDA L-Zone For Investment?
The Delhi Master Plan 2021 focuses on meeting the urban housing requirements for the growing population of the city through the redevelopment of existing areas. The Delhi Development Authority (DDA) came up with zonal plans, as a key component of the master plan, for the 15 zones (A to H; J to P) the national capital territory of Delhi is divided into and notified with the approval of the centre.
The upcoming L-Zone, with its strategic location advantages, is offering new opportunities for investment. If you are looking for promising deals in this location, here’s some valuable information:
What is the L - Zone?
The L - Zone is one of the seven land pooling policy (LLP) zones viz. J, K-I, K-II, L, N, P-I, P-II, earmarked as urbanisable areas that will be opened up for development in a phased manner. Spanning an area of around 22,000 hectares (ha), it is situated in South West Delhi bordering with Dwarka sub-city in Delhi and Gurgaon in Haryana. The policy was notified in 2013. There are as many as 95 villages falling in these zones with L - zone having 58 villages and one Census Town, Najafgarh, thus making it the largest zone among all.
The pluses of L - Zone
Presence of huge land parcels is one of the strong points of these locations situated on the city precincts. And, the Land Pooling Policy (LPP) aims at exploiting this feature. Moreover, the L - zone is located close to the international airport, National Highway - 8 and Dwarka Expressway which increases the investment prospects.
While the development of infrastructure with be solely handled by the authority, the task of commercial development will be shared between the authority and private developers. As per the zonal plan, residential compexes will come up in an area of 5,344 ha, around 46 per cent of the total area. Besides, about 500 ha of land has been proposed under the industrial-use zone, this includes about 100 ha at Tikri Kalan.
Residential properties in Dwarka are priced around Rs 8,000 - Rs 10,000 per sqft; the prices in Najafgarh is much lower at around Rs 3,000 - Rs 5,000 per sq ft. On the other hand, property prices in L-Zone are wide-ranging with some projects available under affordable housing category and others with rates comparable to Gurgaon.
Under the comprehensive Zonal Plan, the L - Zone will undergo changes that would prove beneficial for investors:
Redevelopment: The existing built-up area will be redeveloped. Also, there are about 154 unauthorised colonies which the authorities plan to regularise.
- Transportation: Integration of transport network with the other parts of the city along with a Metro link is one the cards.
- Civic Facilities: In order to fulfil the rising need for potable safe drinking water, the Delhi Jal Board will set up water treatment plant for which 34-ha of land will be provided.
The risks involved
The DDA has not yet notified operational guidelines of land pooling policy. Currently, the L - zone is open for purchase of land parcels. As per land pooling policy, the owners can submit their land which should have a minimum area of 2 hectares. Once approvals are in place, the DDA would take 40 per cent for infrastructure development.
However, even before the authority transferred land titles to any party or sanctioned any project, several developers already announced pre-launch of their projects while some sold apartments merely based on the policy notification. Furthermore, when the Real Estate (Regulation & Development) Act was in the implementation stage, many developers took advantage of the situation by just offering kacha receipts to buyers instead of formal sale deed.
In light of the above instances, real estate experts have been warning buyers of uncertainties by investing in such a market which is faced with issues like lack of infrastructure and fraudulent transactions. Also, there are risks in terms of possible project delays. Hence, buyers who are hoping for project delivery by 2021-22, should rethink and go for it only if they can wait for a longer period. Buyers must also perform a background check of developers to avoid falling into the clutches of unauthorised developers.