Have a room to spare? Govt will help you earn from it

'Bed and Breakfast' scheme gives house owners an income stream

Dilip Dixit is a retired service man who owns a 710 sq ft house in Pune. With space to let, he's hoping to join the country's first-ever `Bed & Breakfast' scheme, which has been launched by the Ministry of Tourism, Government of India.

Inspired by the success of European 'flop-houses' or B&B centres, this scheme is expected to boost the fortunes of property owners like Dixit and of Indian tourism per se, which is growing at 25% annually. The term 'B&B' has its genesis in Great Britain, but its practice began in the Middle Ages when monasteries housed travellers. Its escalating success in recent times is credited to the Internet and online bookings and pricey hotel tariffs.

India's pioneering B&B scheme aims to provide standardised home-stay facilities to tourists in metros and other destinations across India. Goa, Alibaug, Nashik, Shirdi are just some of the hot B&B spots earmarked by the government. The scheme hopes to also address the accommodation crunch in cities like Mumbai and Delhi, in addition to these vacation spots.

Property owners aren't complaining. Says Dixit: "Since I am a retired person, the income would be beneficial to me. The accommodation that I am offering is spacious and clean. Huge hotels charge at the very least Rs 3,000-4,000 per night. The price-tag that I would ask for would be much lesser, say around Rs 500-1,000 per night."

Dixit is cheered by the safety net inherent in a government-led scheme. "The biggest attraction of this scheme is the fact that it comes with government approval stamped on it."

Ministry circles are enthused about the prospects of B&B. Says C Gangadhar, assistant director, India Tourism. The basic idea is to provide a clean and affordable place for foreigners and domestic tourists alike, including an opportunity for foreign tourists to stay with an Indian family and experience Indian customs, traditions and authentic Indian cuisine.

The total number of tourists who visited Mumbai in 1997 was 6.95 lakh, while in 2006 it topped 8.25 lakh.

How the scheme works
Seems like there will be different beds and breakfasts. The B&B scheme will be classified as follows: Standard and Premium. The ministry has formed a Regional Classification Committee, which will inspect and classify the B&B establishments based on the facilities, area and services offered. The committee consists of principal secretary (Tourism State Government), regional director (India Tourism), representatives from IATO, representatives from State Tourism Department etc. The downside is that there's a deposit fee of Rs 3,000 (standard) and Rs.5000 (premium) that is charged with the submission of the form.

Says Dixit: "If the ministry rejects the form on the basis of a technicality, the amount that I have paid will not be refunded. I would have to look at the check-list a lot more carefully."

Explains Gangadhar: "It is the house-owner who decides what amount is charged from a tourist for x number of days. We only intervene in cases where we feel that the rates are over-the-top."

"The fact that a premise is available as B&B is communicated via our 23 offices in India and 13 offices abroad. We also have a website-Incredible India! where an ad will be placed."

Says Gangadhar: "It helps us understand just how many residents are open to the idea. This form of accommodation has become a necessity in metros. It's an entirely new concept and we are getting a lot of queries. The idea is that the residents should maintain their way of life, and yet house tourists."

India will be hosting mega-watt global events like the 2014 Asian Games in Delhi. Media reports state that there is a demand for 30,000 hotel rooms in Delhi and only 10,000 hotel rooms are available. The B&B scheme hopes to effectively tap at least some of the nearly18,000 spare rooms available in the residential sector in the capital, thus addressing the acute accommodation shortage during such seasons.

If this home tourism effort takes off, it could be a cost-effective option for tourists and a golden goose for retired middle-class folks like Dixit. Indian tourism could also get quite comfortable with such room service.

Home buyers to get precise size of flat

Draft Central Realty Bill Says Builders Have To Give Break-Up of Built-Up And Carpet Area In Sale Deed.

Builders may soon find it impossible to hide behind terms like "super area''-built-up area in Mumbai builders' lingo-to conceal the real floor area of apartments they are selling. A new law to regulate real estate developers will require builders to exclude common spaces and balconies while spelling out the floor space of a residential unit.

The proposed bill, a draft of which the Centre is currently working on, will make it mandatory for the builder to specify the area of an apartment in the sale agreement. Besides, a break-up will have to be provided of what the builder is charging for the apartment and a separate calculation for charges levied for common spaces like corridors, parking and lifts.

The Real Estate (Regulation and Control) Bill would allow the buyer to know clearly which common facilities and areas can be used freely and where residents would have limited access.

Builders often juggle between carpet area and super area to confuse buyers, who end up not knowing the floor area of their houses. There have been instances of apartments in the same block having different floor areas and builders even adding parts of common spaces into the floor area of a flat.

The proposed bill notes that often developers promise the moon, claiming that an apartment complex will have its own clubhouse, gym and swimming pool. It is only after buyers have moved in that they realise that many facilities are charged extra. The payment is not merely service charge but also the construction cost.

The bill hopes to provide stringent safeguards against claims that are not honoured.

The urban development ministry intends to put the onus of registration on the property developer and has provided that the sale agreement be registered within three months of the signing of the deal. Failure to comply with the provision will result in a fine of up to 5% of the cost of the house or Rs 50,000, whichever is higher. Builders will also have to shell out Rs 1,000 for each day of default.

This again is the result of developers promising to get the property registered and often sitting on the registration and processing fee collected from buyers. Some of the builders have in the past just kept the money in their bank accounts and earned interest on it for as many as three-four years.

The bill also seeks to bind developers to the date when possession will be given to the buyers. The clause is proposed to be included in the sale agreement itself and any delay will attract a penalty in the form of interest on the advance, to be decided by a regulator, which the Bill also envisages.

The bill is likely to be tabled in the winter session of parliament.

BRICKS IN THE WALL

- The draft bill asks real estate developers to exclude common space and balconies while spelling out floor space of a residential unit

- Builders have to give break-up of charges for flat and a separate calculation for costs levied for common spaces

- The bill seeks to ensure promises like clubhouse, gym and swimming pool are honoured and not charged separately later

- The onus of registration will be on the property developer within 3 months of the signing of a deal on the pain of penalty

- The bill also seeks to bind developers on possession date. Any deviation from date on deed will attract penalty