Retirement homes now a separate real estate category subject to RERA norms

Taking cognizance of a large number of complaints relating to poor delivery of services despite collection of high maintenance charges from senior citizens residing in retirement homes, the Centre has issued guidelines for their regulation and decided to recognise the asset class as a real estate project subject to all provisions of RERA.

“The Model Guidelines for Development and Regulation of Retirement Homes shall work as a template for state governments and urban local areas and help regulate retirement homes. They will ensure ease of living for senior citizens. From approximately 7.6 crore in 2001, the number of senior citizens in India has increased to 10.4 crore in 2011. This number is expected to grow to 17.3 crore by 2025 and about 24 crores by 2050. By the end of the century, senior citizens will constitute nearly 34 percent of the total population of the country,” said housing and urban affairs minister Hardeep Puri on March 6.

It will enable an appropriate regulatory environment wherein the rights of senior citizens are protected and their special needs are addressed. It will bring investment in this special category of real estate, wherein demand is expected to grow steadily, said Durga Shanker Mishra, secretary, MoHUA.

According to a statement, a task force for constant dialogue with states and other stakeholders will be constituted by the Union Housing and Urban Affairs Ministry to ensure implementation of these guidelines.

Under the guidelines, the sale of apartments in retirement homes by promoters shall only be permitted if the retirement home has been registered under RERA and the applicable state rules

States and union territories should notify appropriate planning norms that include the category of retirement homes and their requirements. Retirement homes should be included as a permissible building category under residential land use at suitable location within the city, planning area in respective Master or Zonal or Local Area Plans.

The guidelines state that since retirement home projects are different from conventional real estate projects and have special requirements and in order to encourage developers to build such projects, there should be a provision for additional FAR as an incentive and encourage financial institutions to finance such projects.

The average size recommended for such units is 40 to 60 sq m in plains for a 1 BHK and 50 to 80 sq m for a 2 BHK. The plot size ought to be 3000 sq m with an FAR of 2 and ground coverage of 35 percent. In case of hilly areas, the average size recommended is 30 to 45 sq m for a 1 BHK and 40 to 60 sq m for a 2 BHK. The plot size suggested is 1500 sq m with an FAR of 1.2 and ground coverage of 45 percent.

Developers can build and manage the ‘retirement homes’ or engage a ‘service provider’ or ‘retirement home operator’ for management of these homes, the guidelines say.

They say that such service providers will be required to be registered with appropriate state authorities.

“The model guidelines provide for disclosure of technical skills of the service provider at the time of executing the ‘Agreement to Sale’ in the form of a ‘Tri-Partite Agreement’ to be executed among the developer, service provider/retirement home operators and the allottee,” the statement said.

Retirement Homes should be aligned with the principles, guidelines, norms as prescribed in the ‘National Building Code’ (NBC), ‘Model Building Bye Laws’ and ‘Harmonized Guidelines and Space Standards for Barrier Free Built Environment for persons with disability and elderly persons’.

The guidelines lay down three models for operating retirement homes – ownership model wherein the allottee is the owner of the apartment in a retirement home; reverse mortgage model wherein the property shall stand mortgaged to financial institutions that will pay a lumpsum or monthly installments to the allottees for a period of time as mutually agreed between the parties and the lease or rental model wherein the lessee or the tenant can reside in the apartment on lease or rent from the promoter for an agreed period.

They also state that all buildings of more than one floor must be provided with lifts that are equipped to accommodate users requiring assistance and using wheelchairs.

The projects should follow green building principles to minimize the exposure of senior citizens to fumes and exhaust arising from combustion of fossil fuels. It is desirable that there should be maximum use of non-polluting and renewable energy resources in retirement homes, it says.

The guidelines have recommended provision of basic medical, safety and security services like 24×7 on-site ambulance service, mandatory tie up with emergency facilities with the nearest hospitals and pharmacy, medical emergency room, regular medical check-up of residents, emergency alarm systems, trained and skilled security personnel, CCTV cameras in common areas.

With regard to design of staircases, the guidelines lay down that there should not be more than 12 treads in a single flight and spiral stairs should be avoided.