Building a House With Rental Floors in Pune: What a G+2 or G+3 Costs, and How It Pays Back

In Kharadi, Lohegaon, Dhanori, Wagholi and much of north and east Pune, a common way to build is up: the family lives on one floor, and tenants pay rent on the others. Done well, the rent covers a large share of the construction over time. Done badly, the floors sit empty or the tenants and the family get in each other's way.

Here is how to think it through.

Start with what you are allowed to build

Before costs or rents, find out how many floors your plot allows. That depends on its FSI under Maharashtra's UDCPR rules, the road width, the parking you must provide, and — near the airport — any height limit. A registered architect works this out for your plot. Everything below depends on it.

What it costs

Construction is priced on built-up area, which includes about 50% of the ground slab for the plinth and about 35% of the top slab for the terrace — not just the floors you live on.

On a 1,000 sq.ft footprint, at our Basic rate of Rs. 1,499 per sq.ft:

Higher specifications — our Standard, Premium and Royal packages — raise the rate, and with it each figure.

Does the rent pay for it?

A simple way to judge it: the cost of the rental floors, divided by the rent they bring in a year.

An example, so the method is clear. Take the G+2 above, with the family on the ground floor and the two upper floors let:

• The two rental floors account for roughly two-thirds of the building — about Rs. 45 lakh with GST.
• Suppose each floor rents for Rs. 20,000 a month. Check this against current rents near your plot — it varies a great deal from area to area.
• Two floors bring in Rs. 4.8 lakh a year.
• Rs. 45 lakh ÷ Rs. 4.8 lakh is about 9 to 10 years.

That is a gross figure — before maintenance, months when a floor is empty, and tax. Your own numbers will differ; the method is what matters. Run it with real rents for your area before you decide on the number of floors.

The design decisions that decide the return

Separate meters. Give every rental flat its own water and electricity meter. It avoids arguments over bills, and it is far cheaper to design in than to add later.

Separate entrance and staircase. Tenants coming and going through the family's space is the commonest complaint on both sides. Plan the stair and entry so the two never need to meet.

Layout for the market. Near Kharadi and the IT parks, working professionals look for compact 1BHK and 2BHK flats close to work. A layout that suits the people who actually rent in your area lets faster.

Parking. It is often the limit on how many flats are allowed, and tenants expect it. Stilt or ground-floor parking shapes the whole building, so decide it first.

Water. In areas with unreliable supply, such as parts of Wagholi, size the underground tank for every flat, not just the family's.

How long it takes

A G+1 typically takes 10 to 14 months from foundation to handover, and each additional floor adds roughly one to two months. Rent starts only once the building is complete and certified — count that time when you work out the payback.

The short version

Find out what your plot allows. Price it on built-up area, not plot area. Check the payback with real local rents, before maintenance and vacancies. Design the meters, the entrance, the layout and the parking for tenants from day one.

We build family-and-rental buildings across north and east Pune. Send us your plot details and we will tell you what it allows and what it would cost.