Self-redevelopment in Maharashtra: the GR, cooperative bank loans, and when it beats a developer deal

Rules and rates as of 12 October 2026.

If your building in Mumbai or Pune is 30-plus years old, sooner or later the managing committee will put two paths on the table. One: sign with a developer who offers each member a bigger flat, rent during construction and perhaps a corpus. Two: the society hires its own contractor and project consultant, borrows from a cooperative bank, sells the extra flats itself and keeps the surplus. The second path is called self-redevelopment. This explainer covers what the rulebook says, what we could and could not confirm from official text, and the arithmetic that decides which path leaves members better off.

What self-redevelopment actually is

In a developer deal, the developer pays for construction, approvals and members' rent, and in return takes the sale component: the flats left over after members are rehoused. In self-redevelopment the society stays the owner and the decision-maker. It appoints an architect, a project management consultant and a contractor, raises a construction loan, and sells the sale component on its own account. The developer's margin stays with members. So do the risks the developer would have carried: cost overruns, delays, unsold flats and loan interest.

The Mumbai District Central Co-operative Bank says on its own website that it introduced a self-redevelopment policy in 2011 and revised it in August 2017. It describes the model as redevelopment "without interference of any developer", funded from members' own resources with support from financing agencies and professionals. That page does not publish loan rates, eligibility or limits. Ask the bank for its current sanction terms in writing.

The state government resolution: what we could and could not verify

The state is widely said to have issued a government resolution (GR) on 13 September 2019 with incentives for self-redeveloping societies. We could not read that GR: the state GR portal (gr.maharashtra.gov.in) puts its search behind a captcha, and we could not find the official PDF any other way. We therefore do not describe its concessions here, and they are left out of the arithmetic below. Before your society relies on any concession, ask its advocate to produce the GR and any later amendment and to confirm it applies to your building.

Two things we did confirm. The Maharashtra Co-operative Societies Act, 1960 (text as on 6 June 2025 on India Code) includes section 79A, which gives the state government power to issue directions in the public interest. The state's redevelopment guidelines for housing societies are issued under this section. In Devendra Kumar Jain v. State of Maharashtra (pronounced 6 October 2025), the Bombay High Court called these guidelines "only directory and not obligatory". It held that a majority decision taken at a properly convened meeting prevails, provided participation, notice and disclosure are ensured. For a society, that means process discipline at general body meetings matters more than formality for its own sake. Keep minutes, notices and disclosures clean whichever path you choose.

Does the society need MahaRERA registration?

Read the central Act. Section 3(2)(c) of the Real Estate (Regulation and Development) Act, 2016 exempts "renovation or repair or re-development which does not involve marketing, advertising selling or new allotment" of apartments. A self-redevelopment project that sells a sale component is selling, so the exemption does not fit on its plain words. Section 2(zk)(iv) also names "a primary co-operative housing society which constructs apartments or buildings for its Members" as a promoter. The Explanation to that clause makes the builder and the seller jointly liable where they are different persons. In practice, a society that sells flats should expect promoter-level duties: registration, a separate project account and disclosures. Confirm the exact obligations with a lawyer who handles MahaRERA matters before the first sale.

Worked example: one society, two offers

Every figure below is an illustrative assumption, not a market quote or a bank rate. Our hypothetical society has 40 members, each owning a 500 sq ft carpet flat. After redevelopment the plot can carry 40,000 sq ft of carpet area. A developer offers each member 675 sq ft (35% more), with rent paid during construction and no contribution from members.

Self-redevelopment costs, assuming 36 months:

• Construction: 40,000 sq ft × ₹4,500 = ₹18.00 crore
• Premiums, approvals and fees (lump sum): ₹6.00 crore
• Architect, PMC and legal at 5% of construction: ₹0.90 crore
• Members' rent: 40 × ₹40,000 × 36 months = ₹5.76 crore
• Loan interest: ₹20 crore sanctioned, on average half drawn, at 11% a year: ₹20 crore × 0.5 × 0.11 × 3 years = ₹3.30 crore

Total cost = ₹33.96 crore. The question is how much carpet area each member can take at zero contribution, after selling enough of the remaining area to cover that cost.

Formula: area per member = (total carpet − total cost ÷ sale rate) ÷ number of members.

At a sale rate of ₹25,000 per sq ft: ₹33.96 crore ÷ ₹25,000 = 13,584 sq ft must be sold. (40,000 − 13,584) ÷ 40 = 660 sq ft each. That is less than the developer's 675 sq ft. To take 675 sq ft, each member would have to contribute about ₹3.65 lakh.

Scenario	Total cost	Area each member gets at zero contribution	Member's cash at 675 sq ft (− means surplus paid out)
Sale ₹25,000/sq ft, 36 months	₹33.96 cr	660 sq ft	₹3.65 lakh
Sale ₹25,000/sq ft, 48 months	₹36.98 cr	630 sq ft	₹11.20 lakh
Sale ₹30,000/sq ft, 36 months	₹33.96 cr	717 sq ft	−₹12.60 lakh
Sale ₹30,000/sq ft, 48 months	₹36.98 cr	692 sq ft	−₹5.05 lakh

The 48-month rows add 12 months of rent (₹1.92 crore) and interest (₹1.10 crore). Note that the cost of construction does not change across scenarios. The swing comes from the sale price and from time. If the flats sell at ₹30,000 per sq ft, self-redevelopment beats this developer offer even with a year's delay. At ₹25,000 per sq ft it loses even on schedule. Any concession under the 2019 GR would change these numbers; we have left all of them out because we could not verify them.

When self-redevelopment tends to come out ahead

• Sale rates are high relative to construction cost. Then the developer's margin is large, and keeping it is worth the risk.
• The society can run a tight timeline. Each month of delay adds rent and interest, and members carry both.
• Members can absorb a cash call. If sales lag, the society needs a buffer, and the bank's comfort letter is not a guarantee of more money.
• The committee can manage contractors and MahaRERA compliance, or pay a competent PMC to do it.

If the developer's offer is close to what self-redevelopment yields on optimistic assumptions, the developer is carrying risk for a modest fee. That may be a fair trade for many societies.