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Customer Welfare
Very often when we go to look at flats, we come across terms like Carpet Area, Built-up Area, Loading, Saleable Area etc. It is important that we know what they are so that we can make an informed decision. Here’s some property bites…
Carpet Area is the area that you actually get inside the house. Carpet Area literally means it is the area available to lay a carpet if you intended to! This is actually the area that you are going to pay your money for. Though the regulations require builders to quote rates for carpet area, they still don’t and do it only in the agreement by merely converting the cost.
The Built-up Area apart from the Carpet Area takes into account the thickness of the internal and outer walls and also the area of the balcony. The built-up area is generally never used for commercial discussions.
The Super Built-up Area (also known as the ‘Saleable’ Area) is relevant to multi-dwelling units and is the one term you will hear often. It includes the area for common use like lobby, lifts, staircase etc. In current scenarios, it also takes into account amenities like clubhouse, swimming pools, garden etc. All this is proportionally divided amongst the flats. The ‘Loading Factor’ is derived here which is applied on the carpet areas to get the Super Built-up Area or the Saleable Area.
- Typical Calculation:
- Things to note about area when looking at a property
- Carpet Area:
- Terrace:
- Balcony:
- Dry terrace or dry balcony:
- Built up Area:
- Loading factor or loading or load:
- Super built up Area:
- Usable Area:
- Saleable Area:
- FSI:
- Methods used to calculate saleable area
- Summary
Carpet Area: 800 sq. ft.
Balcony / Terrace: 50 sq. ft.
Loading Factor: 30% (0.3)
Super Built-up Area: [800 + (50 × 0.5)] × 1.3 = 1072.5 sq. ft.
As seen in the above calculation, please note that only half of the area of the balcony / terrace has to be considered for loading. I guess this is because balconies are not charged for F. S. I.
1. Compare and confirm the Carpet Area of the flat with what is shown in the floor plan / brochure. It is pretty simple and does not need an architect. The plan would have the wall to wall dimensions. Normally the tiles used these days are standard 2’ × 2’ marbonite tiles. So if the brochure says the dimensions as 10’ × 14’, you should see 5 tiles in breadth and 7 tiles in length. Simple! You could also measure using a regular measuring tape.
2. Once you have seen and confirmed that the area in the flat is as it is shown in the plan, you need to enquire how the builder has calculated the Saleable Area. It should be in line as explained above.
3. It is good to understand the loading factor taken by the builder. However, beware of misrepresentation of the loading factor or carpet area. Below illustration explains how.
Actual Scenario:
Carpet Area = 1000 sq. ft.
Loading Factor = 25% (0.25)
Saleable Area = 1000 × 1.25 = 1250 sq. ft.
However, the builder may tweak the information by telling you this.
Scenario when Loading Factor is misrepresented:
Saleable Area = 1250 sq. ft.
Loading Factor = 20% (0.2)
Carpet Area = 1250 × 0.8 = 1000 sq. ft.
Here the builder has charged a loading of 25% but has claimed it to be only 20%
Scenario when Carpet Area is misrepresented:
Saleable Area = 1250 sq. ft.
Loading Factor = 25% (0.25)
Carpet Area = 1250 × 0.75 = 937.5 sq. ft.
Here the builder has charged for 1250 sq. ft. with a loading of 25%. But instead of getting a carpet area of 1000 sq. ft., you get only 937.5 sq. ft.
4. If you are comparing properties and want to compare the cost, it would be a good idea to take the total cost and find the cost per sq. ft. of carpet area.
Concluding Note: This intent of this write-up was to help you make informed decisions. Different builders would have different ways of doing things like considering a higher loading factor, considering 100% terrace areas for loading etc. With buoyant demand, they may not be ready to change these for you, but you need to be aware of these when you make your decision. Finally, when you find your dream home, it’s a decision of the heart.. Don’t let too many technicalities come in your way!
Carpet Area: 800 sq. ft.
Balcony / Terrace: 50 sq. ft.
Loading Factor: 30% (0.3)
Super Built-up Area: [800 + (50 × 0.5)] × 1.3 = 1072.5 sq. ft.
Area between the walls. Carpet area must have permanent roof (slab) over it, at normal height. Owner must get exclusive rights to use and resell the carpet area. Carpet area is calculated by multiplying dimension of room, i.e. length × width. Total carpet area is calculated by adding carpet areas of all rooms. Generally, in addition to all the rooms, varandas, passages, area inside the main door (if not included in living room dimension), balconies are included in carpet area. FSI is applicable to carpet area. Depending upon builder practice, carpet area may be 50% to 70% of of saleable area. It is always good to find ratio of carpet area to the saleable area, higher the ratio, better it is. This is just to give you idea of what you actually can use, in practice it is in interest of the buyers to find out what is carpet area and then apply loading factor on it (and not do the other way, i.e. should not arrive at carpet by applying loading factor to saleable area.
The example below will illustrate trick used by builders/developers, when they say you can find carpet area by applying loading factor on the saleable area.
Saleable Area: 1200 sq ft
Loading Factor: 25% (or 1.25)
Wrong Method (favours seller):
Carpet Area: 1200 × (100-25)% = 1200 × 75% = 900 sq ft
If you apply 1.25 or 25% loading, saleable area should be 900 sq ft + 900 × 25% = 1125 sq ft
As you can see under this method builder is charging you for 1200 - 1125 = 75 sq ft more
Right Method (favours buyer):
Find carpet area first by measuring actual dimensions, and then apply loading factor
Saleable area = 900 sq ft + 900 x 25 % = 1125 sq ft
Open area without roof, attached to the main unit that buyer gets exclusive rights to use and resell (with the main unit). Open areas with slab at least double the height of the floor are also considered terrace area. FSI is not applicable to terrace areas.
Open area with roof (slab at floor height), attached to the main unit that buyer has exclusive rights to use and resell (with the main unit). Generally balcony area is added to total carpet area. FSI is applicable to balconies.
Area meant to dry clothes that buyer has exclusive rights to use and resell (with main unit). If it has roof (slab) at normal height, it should be treated as balcony. If it does not have roof (slab) at normal height, it should be treated as terrace.
Carpet Area + area occupied by walls, doors of the unit. Generally builtup area is not calculated separately, it is included into the loading factor.
Loading factor is a number used for purpose of arriving at saleable area. It is used to add constructed space not exclusively allocated to the buyer. Such area generally includes shared areas such as lift/elevator area, staircases, clubhouse, gymnasium, amenities area, etc. Loading factor 1.25 indicates that developer/builder is applying 25% on the carpet area. Some builders, in addition to carpet area, include terrace and balcony areas while applying the loading factor. If the project does not have lot of amenities, the loading factor should be small. In most cases loading factor of 1.3 is more than sufficient. Loading factor also includes parking space (irrespective of it is covered, open, stilt, sold separately or not).
Carpet area + terrace + balconies + areas occupied by walls + area occupied by common/shared construction (e.g. lift, stairs, club house, etc). Generally builders use loading factor on carpet area to arrive at superbuiltup area. For example, if carpet area is 500, and loading factor is 1.3, then super built up area is 500 x 1.5 = 750.
This is relatively new term. Technically there is no difference between Usable Area and Superbuiltup Area. Some builders use this term to justify higher loading factor, typically in Mumbai where land cost is extremely high.
Generally super built up area is saleable area.
Floor Space Index. This is ratio of land to carpet area. Generally it is 1 for residential plots (much less for agricultural land) For example, if FSI is 1, and land area is 3000 sq ft, then total carpet area on that land cannot exceed 3000 x 1 = 3000 sq ft. It should be noted that FSI is not applicable to terraces, balconies. Also, this definition is provided for your information, enforcement of FSI is taken care of by local authorities, and buyer should not worry about it (unless there are allegations against the builder of misusing FSI).
Builders apply different models to arrive at saleable area. The methods used by builder can result into as high as 20% to 25% increase in the effective rate. We will try to explain different methods (not all of them) used by developers/builders and their relative impact on saleable area, total price, and ratio of carpet to saleable area.
- saleable area does not mean bigger carpet area
- Lower rate does not mean good deal because it can result into higher effective rate because of loading factor, and the way terraces are charged (at 50% or 100% or at some other %), and if loading factor is applied on top of terraces
- Method used by builder can cause a big swing in the total price as demonstrated in the example above
- Lower loading % does not necessarily mean it is better deal, one needs to look into how it is applied on terraces, gardens and other areas that are not included in FSI
