Course Content
GATE Architecture & Planning (AR) — Preparation Course

LESSON 5.7 — Housing Policies and National Programs


A. Standard Map — Lesson 5.7

Topic Governing Source Exam Focus
Institution timeline Five-Year Plans; MoHUA; NHB Act 1987 ITPI (1951), HUDCO (1970), NHB (1988) — plan period linkage
JNNURM 2005–2014 JNNURM Mission Guidelines; ch01-part03 Four sub-missions; BSUP = slum improvement vertical; UIG = infrastructure
PMAY-U verticals PMAY-U Mission Guidelines 2015 ISSR / AHP / CLSS / BLC — mechanism, minimum unit, central assistance
PMAY-U 2.0 (Sept 2024) PMAY-U 2.0 Cabinet Note; ch01-part03 Date-sensitive: ISS at 4%; 1 crore houses; ₹2.5 lakh BLC grant; women ownership
EWS/LIG/MIG income thresholds PMAY-U Guidelines 2017 revision Table: income ceiling + carpet area norm per group
RERA 2016 RERA Act 2016; ch01-part03 >500 sq.m OR >8 units trigger (OR-logic); exemption = BOTH < 500 AND < 8; 70% escrow
Valuation approaches ch09-part03 Rental, Land-and-Building, Profit, Development — when each applies

Exam Anchor: RERA threshold = > 500 sq.m OR > 8 units — if either condition is exceeded, registration is mandatory. Exemption requires both to be below threshold simultaneously. This OR/AND logic is the highest-frequency RERA trap.

Date-sensitive: PMAY-U 2.0 (September 2024) replaces CLSS with ISS at unified 4% subsidy on first ₹8 lakh for income up to ₹9 lakh. PMAY-U 1.0 CLSS rates (EWS/LIG 6.5%; MIG-I 4%; MIG-II 3%) are now closed. GATE 2025+ answers on the current scheme should reference PMAY-U 2.0 ISS.


B. Mechanism in Words — Housing Policy Delivery

  1. Institution creation — specialised housing and planning bodies are created through Five-Year Plans: ITPI (town planning), HUDCO (urban development finance), NHB (housing finance).
  2. Programme identification — government identifies the scale of housing shortage and the segments most affected (EWS/LIG).
  3. Scheme launch — a national scheme (JNNURM, PMAY-U) is designed with verticals targeting different delivery mechanisms (slum rehabilitation, partnership, subsidy, self-build).
  4. Central and state funding — Centre provides a fixed grant per unit; state provides land or matching share; ULB implements.
  5. Beneficiary identification and delivery — eligible households identified by income group and Aadhaar; units delivered through the relevant vertical mechanism.
  6. Regulation — RERA 2016 protects buyers in the formal private market; escrow ensures developer accountability.

C. Core Concept Explanations — Lesson 5.7

C1. Institution Timeline — ITPI, HUDCO, NHB

Institution Year Plan Period Role
ITPI — Institute of Town Planners India 1951 1st Plan Professional body for town planners; education, examination, professional standards
SPA — School of Planning and Architecture 1955 1st Plan Premier planning and architecture education institution; Delhi campus oldest
HUDCO — Housing & Urban Development Corporation 1970 4th Plan State-owned enterprise; finances urban housing and infrastructure for state governments and ULBs; subsidised loans for EWS/LIG housing
NHB — National Housing Bank 1988 7th Plan Apex institution for housing finance; regulates Housing Finance Companies (HFCs); nodal agency for PMAY-U CLSS/ISS disbursement (alongside HUDCO)

Full scheme chain (sequential, exam-critical):

VAMBAY (2001) → JNNURM (2005) → RAY (2013) → PMAY-U (2015) → PMAY-U 2.0 (2024)

  • JNNURM ended 2014 — it was NOT merged into PMAY-U.
  • RAY merged into PMAY-U in 2016.
  • These are separate events; confusing them is a classic trap.

C2. JNNURM (2005–2014) — Four Sub-Missions

The Jawaharlal Nehru National Urban Renewal Mission (2005–2014) was India’s largest urban infrastructure and housing investment programme at the time of launch.

Sub-Mission Full Name Target Nodal Ministry
UIG Urban Infrastructure and Governance 65 mission cities (large urban centres) Ministry of Urban Development
BSUP Basic Services to the Urban Poor 65 mission cities — slum improvement Ministry of Housing and Urban Poverty Alleviation (MHUPA)
UIDSSMT Urban Infrastructure Development Scheme for Small & Medium Towns Non-mission cities (smaller towns) Ministry of Urban Development
IHSDP Integrated Housing and Slum Development Programme Non-mission cities MHUPA

BSUP in context of 5.6-5.7: BSUP was the slum improvement vertical of JNNURM — providing housing units, sanitation, water supply, and community infrastructure in the 65 largest cities. It preceded PMAY-U’s ISSR vertical and established the policy precedent for in-situ slum redevelopment at scale.

Most commonly missed sub-mission in exams: UIG (Urban Infrastructure and Governance) is consistently omitted. Always list all four — UIG, BSUP, UIDSSMT, IHSDP.


C3. PMAY-U — Four Verticals (Mechanism Level)

The Pradhan Mantri Awas Yojana — Housing for All (Urban) was launched in June 2015 with a target to provide every eligible urban household a pucca home. It operates through four verticals:

Vertical Full Name Target Beneficiary Mechanism Min. Carpet Area Central Assistance
ISSR In-Situ Slum Redevelopment Slum dwellers on notified/identified slum land PPP — developer gets additional FSI; provides free EWS unit; cross-subsidy from market-rate units 30 sq.m ₹1 lakh per unit
AHP Affordable Housing in Partnership EWS households; government land provided State/public agency provides land to developer; minimum 35% EWS units mandatory 30 sq.m (EWS) ₹1.5 lakh per EWS unit
CLSS / ISS Credit Linked Subsidy Scheme / Interest Subsidy Scheme EWS, LIG, MIG on home loan Interest subsidy on home loan disbursed upfront as NPV; PMAY-U 2.0 → ISS Depends on income group Subsidy amount varies (see C4 below)
BLC Beneficiary-Led Construction EWS/LIG households with own land Direct grant for self-construction/enhancement; no developer; Direct Benefit Transfer Self-determined ₹1.5 lakh (general states); ₹2.5 lakh (NE/hilly)

ISSR — mechanism in detail:
1. ULB identifies slum; determines number of eligible families.
2. Private developer selected by competitive bidding.
3. Developer provides minimum 30 sq.m carpet area free unit to each eligible slum dweller.
4. Developer receives additional FSI (typically 2.5–4.0) to construct market-rate units on the same plot — cross-subsidy finances free EWS units.
5. Eligibility: beneficiary family must not own a pucca house anywhere in India.

AHP — mechanism in detail:
1. State/UT or public agency provides land.
2. Developer must earmark minimum 35% of units for EWS category.
3. Central assistance ₹1.5 lakh per EWS unit flows to the state/developer for EWS unit construction.
4. Market-rate units cross-subsidise EWS units.

BLC — mechanism in detail:
1. Beneficiary must own land (plot) and not have a pucca house.
2. Direct grant of ₹1.5 lakh (general states) transferred in instalments.
3. No developer involvement — the beneficiary manages construction.
4. Most flexible vertical; most suitable for rural-fringe and smaller towns.


C4. PMAY-U 2.0 (September 2024) — Date-Sensitive Content

Critical for GATE 2025+ and UPSC exams: PMAY-U 2.0 was approved by the Union Cabinet in August 2024 and formally launched in September 2024. Any exam question about the current PMAY-U interest subsidy must reference PMAY-U 2.0 ISS, not the closed PMAY-U 1.0 CLSS rates.

PMAY-U 1.0 CLSS (now CLOSED):

Category Subsidy Rate Max Loan Carpet Area Status
EWS/LIG 6.5% ₹6 lakh ≤ 60 sq.m Closed 31 March 2022
MIG-I 4% ₹9 lakh ≤ 160 sq.m Closed 31 March 2021
MIG-II 3% ₹12 lakh ≤ 200 sq.m Closed 31 March 2021

PMAY-U 2.0 ISS (current, from September 2024):

Parameter PMAY-U 2.0 ISS Value
Subsidy rate Unified 4%
Loan amount eligible First ₹8 lakh of loan
Income ceiling Household income up to ₹9 lakh per annum
Nodal agencies NHB + HUDCO (unchanged)

Other PMAY-U 2.0 changes:
– Target: 1 crore additional urban houses over 5 years (2024–2029)
– BLC grant enhanced: ₹2.5 lakh per unit (up from ₹1.5 lakh) for EWS under BLC vertical
– Expanded to all statutory towns (PMAY-U 1.0 initially covered only 4,041 towns)
– Mandatory sustainable building materials and green building norms
Women ownership mandatory: all houses to be jointly or solely in the name of a female family member
– Convergence with Swachh Bharat Mission 2.0 and AMRUT for infrastructure

Source: PMAY-U 2.0 Cabinet Note (August 2024); MoHUA Mission Guidelines (September 2024); ch01-part03; ch09-part01.


C5. EWS / LIG / MIG — Income and Area Thresholds

Income Group Annual Household Income (PMAY-U 2017 revision) PMAY-U Carpet Area Norm
EWS Up to ₹3 lakh Up to 30 sq.m
LIG ₹3–6 lakh Up to 60 sq.m
MIG-I ₹6–12 lakh Up to 160 sq.m
MIG-II ₹12–18 lakh Up to 200 sq.m
HIG Above ₹18 lakh No ceiling

Important: These are PMAY-U income definitions. NBC 2016 and URDPFI use different income classifications in some contexts. For any exam question that specifies “under PMAY-U,” use the above thresholds.

EWS plot size under URDPFI 2015 (separate from PMAY-U carpet area):
– EWS minimum plot: 25 sq.m (metro); up to 40 sq.m (non-metro)
– LIG minimum plot: 40–80 sq.m


C6. RERA 2016 — Registration Threshold, Exemptions, and Key Provisions

The Real Estate (Regulation and Development) Act 2016 was enacted to protect homebuyers and regulate the real estate sector.

Registration threshold (the most-tested RERA provision):

RERA registration is mandatory for any real estate project where:
Total area > 500 sq.m (of land to be developed) OR total units > 8 apartments
whichever threshold is crossed first triggers mandatory registration.

Exemption logic — the AND condition:

Scenario Registration Required?
Project: 600 sq.m area, 6 units Yes — area > 500 sq.m triggers (even though units < 8)
Project: 400 sq.m area, 10 units Yes — units > 8 triggers (even though area < 500 sq.m)
Project: 600 sq.m area, 10 units Yes — both triggers exceeded
Project: 400 sq.m area, 6 units No — both conditions below threshold (< 500 sq.m AND < 8 units)
Project with Completion Certificate before RERA commencement Exempt — completed projects are exempt

RERA trap: Many candidates believe the exemption is “OR” — that a project is exempt if area < 500 OR units < 8. The correct rule: exemption only when BOTH area < 500 sq.m AND units < 8 simultaneously.

Other key RERA provisions (awareness level):
70% of buyer payments must be held in an escrow account linked to project completion — prevents diversion of funds.
Real Estate Regulatory Authority (RERA) established in each state and UT.
Real Estate Appellate Tribunal (REAT) — appeals body.
Agent registration mandatory for any agent involved in RERA-registered project transactions.
Carpet area as defined by RERA = usable floor area (excluding walls, balconies) — standardises a previously manipulated measure.
– Promoter must obtain all approvals before launching — prevents under-construction project launches without clear title.


C7. Valuation Approaches — When Each Applies

Three principal valuation approaches are used in Indian real estate practice, each derived from a different conceptual basis.

Approach Also Called Applicable When Core Logic
Market (Comparison) Approach Direct comparison; sales comparison Active market with frequent sales of comparable properties; residential plots and standard apartments Value = price a willing buyer pays a willing seller in an arm’s-length transaction; compare recent sale prices of similar properties; adjust for differences
Income (Rental) Approach Investment method; rental method; capitalisation method Income-generating properties: commercial buildings, industrial premises, offices, rental apartments Value = Net Annual Rent × Years’ Purchase (YP = 1/yield); YP converts annual income stream into a capital sum
Cost (Land-and-Building) Approach Physical method; contractor’s method No comparable sales or rental market: owner-occupied houses, special-purpose buildings (temples, schools, hospitals), unique properties Value = Market value of land + Depreciated replacement cost of building
Development Method Residual method; hypothetical building scheme Undeveloped or under-developed land where value depends on development potential Land Value = GDV − construction − professional fees − finance − developer’s profit (15% site area deducted for roads/amenities)
Profit Method Accounts method Special-use properties where value is a function of business profits: cinemas, hotels, petrol pumps, nursing homes Value = net profit (property share, excluding goodwill) × YP; average last 3 years; deduct goodwill component

Purpose-specific valuation (exam-relevant):

Purpose Preferred Method Rationale
Mortgage / home loan Conservative Rental or Land-and-Building Safeguards lender; value should not be overstated
Purchase / sale Market comparison Actual market prices; both parties’ interests
Land acquisition (LARR) All three methods may be used liberally Unwilling seller deserves generous compensation
Property tax (municipal) Market value basis Annual rental value or capital value depending on state system
Insurance Replacement cost (Land-and-Building) Cost to rebuild — land does not burn; exclude land value

Source: ch09-part03 Sections 9.13, 9.14; Transfer of Property Act 1882; RERA 2016.


D. Scheme Comparison Table — JNNURM vs PMAY-U + RERA Applicability Worked Examples

D1. JNNURM vs PMAY-U — Key Comparison

Dimension JNNURM (2005–2014) PMAY-U (2015–2024) / PMAY-U 2.0 (2024–)
Mission type Infrastructure + housing (dual) Housing-focused (four verticals)
Slum vertical BSUP (Basic Services to Urban Poor) ISSR (In-Situ Slum Redevelopment)
Approach Supply-side: government-built housing + infrastructure Demand + supply: credit subsidy + PPP + direct grant
Target cities 65 mission cities (UIG/BSUP) + smaller towns (UIDSSMT/IHSDP) All 4,041 statutory towns (expanded to all statutory towns in 2.0)
Slum unit size Minimum 25 sq.m (BSUP norm) Minimum 30 sq.m carpet area (PMAY-U ISSR norm)
Central assistance 80:10:10 (Centre:State:ULB) for general states Varies by vertical; ISSR ₹1 lakh/unit; BLC ₹1.5 lakh/unit (₹2.5 lakh in 2.0)
End date Ended 2014 (NOT merged into PMAY-U) PMAY-U 1.0 → 2015–2024; PMAY-U 2.0 → 2024–2029
Key PYQ trap “JNNURM was replaced/merged into PMAY-U” JNNURM ended; RAY (a separate scheme) was merged into PMAY-U in 2016

D2. RERA Applicability — Worked Examples

Scenario 1:
A developer proposes to build 12 apartments on a 450 sq.m plot in Bengaluru. Is RERA registration mandatory?

Analysis: Area = 450 sq.m (< 500 sq.m threshold) BUT units = 12 (> 8 units threshold).
Since units > 8, the units threshold is crossed → RERA registration is mandatory.
The OR-logic means either threshold crossing triggers registration.

Scenario 2:
A builder constructs 6 independent villas on a 3,000 sq.m layout. Is RERA registration mandatory?

Analysis: Area = 3,000 sq.m (> 500 sq.m threshold) → RERA registration is mandatory.
Even though units (6) < 8, the area exceeds 500 sq.m — OR-logic applies.

Scenario 3:
A small developer proposes 5 apartments on a 380 sq.m plot. Is RERA registration mandatory?

Analysis: Area = 380 sq.m (< 500 sq.m ✓) AND units = 5 (< 8 ✓).
Both thresholds below limit → RERA registration is NOT mandatory (exempted).


E. Common Confusions — Lesson 5.7

Confusion Clarification
“JNNURM was merged into PMAY-U” JNNURM ended in 2014 — it was a separate programme that concluded. RAY (Rajiv Awas Yojana) was merged into PMAY-U in 2016.
“RERA exemption = area < 500 OR units < 8” Exemption requires both area < 500 sq.m AND units < 8 simultaneously. The trigger is OR; the exemption is AND.
“PMAY-U 2.0 has the same CLSS rates as PMAY-U 1.0” PMAY-U 2.0 replaces CLSS with ISS at unified 4% on first ₹8 lakh for incomes up to ₹9 lakh. PMAY-U 1.0 CLSS (6.5% for EWS/LIG) is closed.
“AHP requires government to build the houses” AHP provides land and central assistance — a private or public developer builds; the developer must include minimum 35% EWS units.
“BLC is only for rural households” BLC (Beneficiary-Led Construction) is a PMAY-U vertical — it covers urban households with their own land, not rural households (PM Awas Yojana-Gramin covers rural).
“EWS income ceiling is ₹2.5 lakh” EWS = up to ₹3 lakh per annum (PMAY-U 2017 revision). ₹2.5 lakh was an earlier threshold.
“RERA carpet area includes balconies” RERA-defined carpet area = usable floor area excluding walls, terraces/balconies, and exclusive open terraces. Balconies are separately disclosed.

F. Exam Traps — Lesson 5.7

Trap Incorrect Belief Correct Principle
RERA threshold logic “A project with 700 sq.m area but only 5 units is exempt” RERA mandatory for area > 500 sq.m — regardless of unit count. OR-logic: either threshold triggers registration.
RERA exemption logic “Exempt if area < 500 sq.m OR units < 8” Exempt only if area < 500 sq.m AND units < 8 — both simultaneously below threshold
PMAY-U 2.0 ISS rate Current subsidy rate = 6.5% (PMAY-U 1.0 EWS/LIG rate) PMAY-U 2.0 (Sept 2024): unified 4% on first ₹8 lakh for income ≤ ₹9 lakh
JNNURM end vs merge JNNURM was merged into PMAY-U JNNURM ended 2014; RAY was merged into PMAY-U in 2016; these are separate facts
BSUP vs ISSR BSUP and ISSR are the same slum vertical under different names BSUP = JNNURM sub-mission (2005–2014). ISSR = PMAY-U vertical (2015–present). Different programmes, different mechanisms.
AHP minimum EWS share AHP requires 25% EWS units AHP requires minimum 35% EWS units — not 25% or 50%
BLC central assistance BLC grant = ₹1 lakh (general states) General states = ₹1.5 lakh (PMAY-U 1.0); ₹2.5 lakh (PMAY-U 2.0). NE/hilly states always higher.
EWS income threshold EWS = ₹2.5 lakh or ₹2 lakh EWS = up to ₹3 lakh per annum (PMAY-U 2017 revision).
Market approach = only valid method Market comparison is always appropriate Market approach works only with comparable sales; rental method applies to income properties; cost method for special-purpose buildings; development method for undeveloped land
NHB as direct lender NHB directly lends to homebuyers NHB is the apex regulator and refinancer for housing finance companies; the nodal disbursement channel for PMAY-U CLSS/ISS — it does not directly lend to individual homebuyers

G. Answer-Writing Cues — Lesson 5.7

MCQ (RERA threshold):

Template: “RERA threshold = > 500 sq.m OR > 8 units. The OR triggers registration if either is exceeded. Exemption = both area < 500 sq.m AND units < 8 simultaneously.”

MCQ (PMAY-U vertical identification):

Template: Apply the vertical diagnostic: Slum on slum land with PPP → ISSR. Government land + developer + 35% EWS → AHP. Home loan subsidy → ISS (PMAY-U 2.0). Self-build on own land → BLC.

Short answer (PMAY-U 2.0 ISS, 2 marks):

Template: “PMAY-U 2.0 (September 2024) replaced the closed CLSS with the Interest Subsidy Scheme (ISS): a unified 4% interest subsidy on the first ₹8 lakh of home loan for households with annual income up to ₹9 lakh. The mission targets 1 crore additional urban houses (2024–2029), with enhanced BLC grant of ₹2.5 lakh, mandatory women ownership, and expansion to all statutory towns.”

Short answer (valuation method selection, 2 marks):

Template: “The appropriate valuation method depends on the property type and purpose: (1) Market approach — standard residential; active comparable sales market. (2) Rental/Income approach — commercial/industrial income-generating properties; capitalise net annual rent at an appropriate yield (YP = 1/i). (3) Cost/Land-and-Building approach — owner-occupied, special-purpose (schools, temples); no rental market. (4) Development method — undeveloped land; residual land value after deducting all costs and developer’s profit from GDV.”


H. PYQ Linkage Note — Lesson 5.7

Topic Exam Appearance Pattern
RERA threshold (500 sq.m / 8 units) GATE AR; UPSC; State PSC MCQ on OR logic; worked example testing exemption
PMAY-U vertical identification GATE AR multiple years MCQ: match scenario to vertical (ISSR / AHP / ISS / BLC)
JNNURM ended vs merged GATE AR; UPSC MCQ trap: “JNNURM merged into PMAY-U” = wrong
EWS/LIG income thresholds GATE AR; State PSC MCQ: EWS = ₹3 lakh (not ₹2 or ₹2.5 lakh)
HUDCO / NHB establishment year GATE AR; architecture exams MCQ: HUDCO 4th Plan (1970); NHB 7th Plan (1988)
Valuation approach selection GATE AR; UPSC-CPWD MCQ: which method for income-generating vs special-use vs undeveloped land

I. Mini-Check — Lesson 5.7

Q1 (MCQ — PMAY-U vertical)
A local body in Pune has identified a notified slum on a 2-acre government-owned plot. The plan is to involve a private developer who will provide free housing to all eligible slum dwellers and sell market-rate units to recover costs. Which PMAY-U vertical is being used?

(A) Beneficiary-Led Construction (BLC)
(B) Credit Linked Subsidy Scheme (CLSS/ISS)
(C) In-Situ Slum Redevelopment (ISSR)
(D) Affordable Housing in Partnership (AHP)

Answer: (C)
The ISSR vertical involves: a notified/identified slum + PPP with a private developer + free unit to eligible slum dwellers + cross-subsidy from market-rate units on the same land. This matches exactly. BLC (A) requires beneficiaries to have their own land and self-build. ISS (B) is a home loan subsidy. AHP (D) requires government land with 35% EWS units — not slum rehabilitation.

Q2 (MCQ — RERA threshold)
A developer proposes to construct 9 apartments on a 420 sq.m plot. Is RERA registration mandatory?

(A) No — the plot area is below 500 sq.m, so RERA does not apply
(B) No — neither threshold is crossed
(C) Yes — the number of units exceeds 8, triggering mandatory registration
(D) Yes — only if the developer accepts advance payments from buyers

Answer: (C)
RERA registration threshold = > 500 sq.m OR > 8 units. Area = 420 sq.m (< 500 sq.m, not triggered), but units = 9 (> 8, triggered). The OR-logic means crossing either threshold is sufficient. Option (A) is the trap answer — it applies AND-logic incorrectly.

Q3 (MCQ — PMAY-U 2.0 date-sensitive)
Under PMAY-U 2.0 (September 2024), what is the interest subsidy rate and the maximum loan amount eligible for subsidy under the Interest Subsidy Scheme (ISS)?

(A) 6.5% interest subsidy on the first ₹6 lakh of home loan
(B) 4% interest subsidy on the first ₹8 lakh of home loan
(C) 3% interest subsidy on the first ₹12 lakh of home loan
(D) 4% interest subsidy on the full home loan amount

Answer: (B)
PMAY-U 2.0 ISS (from September 2024): unified 4% subsidy on the first ₹8 lakh of home loan, for household income up to ₹9 lakh per annum. Option (A) describes the closed PMAY-U 1.0 EWS/LIG CLSS rate. Option (C) is not a PMAY-U rate. Option (D) is incorrect — the subsidy applies to the first ₹8 lakh only, not the full loan.

Q4 (MCQ — scheme timeline)
Which of the following correctly describes the relationship between JNNURM and PMAY-U?

(A) JNNURM was merged into PMAY-U in 2015
(B) PMAY-U is a successor scheme that absorbed JNNURM’s housing components
(C) JNNURM ended in 2014; RAY (a separate scheme) was merged into PMAY-U in 2016
(D) JNNURM continues as the infrastructure vertical while PMAY-U handles housing

Answer: (C)
JNNURM ended in 2014 — it was not merged or absorbed. It concluded as a time-bound mission. RAY (Rajiv Awas Yojana, a later programme) was merged into PMAY-U in 2016. PMAY-U is not a direct successor of JNNURM — it is a new mission with a different design (demand-side subsidies + verticals, rather than JNNURM’s supply-side infrastructure push).

Q5 (MCQ — valuation approach)
A valuer is asked to determine the value of a municipal school building in a Tier-2 city. No comparable sales exist for similar properties and the building is not income-generating. Which valuation approach is most appropriate?

(A) Market comparison approach — compare with recent sales of commercial buildings
(B) Income (rental) approach — capitalise the school’s hypothetical rental income
(C) Cost (Land-and-Building) approach — land market value + depreciated replacement cost of building
(D) Profit method — capitalise the school’s goodwill value

Answer: (C)
A municipal school is a special-purpose building with no active sales market and no income generation. The Cost / Land-and-Building approach is the correct method: market value of the land (by comparable land sales) + depreciated replacement cost of the building. The Profit method (D) applies to business-profit-driven properties (hotels, cinemas, petrol pumps) — not public facilities.


End of Lessons 5.6 and 5.7