Parliamentary Committee Clears Path to Sell Houses, Apartments Built on Land Beyond Standard Ceiling

A parliamentary committee has approved a bill that allows licensed real estate companies to sell houses and apartments constructed on land acquired beyond the standard land ceiling under government approval, a move developers say will unlock stalled projects across the country.

The Agriculture, Cooperatives, and Natural Resources Committee of the House of Representatives passed the bill on Thursday by majority vote, despite opposition from the CPN (Maoist Centre) and the Rastriya Swatantra Party (RSP). The provision permits the sale of residential units built on land legally acquired beyond the normal ceiling for housing and real estate purposes.

Under the Land Act, 1964, amended in 2019, developers could acquire land exceeding the ceiling for housing and real estate development, but legal restrictions previously prevented the sale of units constructed on such land. The committee-approved bill introduces a “Special Provision for Real Estate Business on Land Beyond Standard Ceiling”, which will enable one-time sales of housing units once the law is passed by both houses of parliament and certified by the President.

According to committee secretary Shiva Datta Baral, companies with government approval for real estate operations and land acquired beyond the standard ceiling for residential purposes will now be allowed to sell houses or apartments built on that land, provided they meet conditions specified in government orders.

“Housing developers who built on land exceeding the legal ceiling but had prior government approval will now be able to legally sell their units,” Baral said. “This provision also ensures that areas or structures designated for collective use are transferred into joint ownership of the buyers and cannot be mortgaged or sold separately.”

Housing developer Bhesh Raj Lohani said the provision could relieve more than 15 housing and apartment projects currently facing sales obstacles. “To comply with legal requirements, we had registered multiple companies to construct units on land exceeding the ceiling under government approval. This amendment allows us to sell those units without legal hurdles,” he added.

The bill also specifies that real estate companies may develop and sell housing units only on land classified as residential or commercial by the Local Land Use Council. Developers cannot subdivide or sell land without completing construction. If land acquired under government approval and exceeding the ceiling is later classified as non-residential or non-commercial, it may still be subdivided and sold once, provided the council recommends it and the Council of Ministers grants final approval.

Lawmakers had previously expressed concerns about ambiguous language in the draft bill that could allow misuse of land-use provisions. Senior officials from the Ministry of Land Management and the Ministry of Law said the revisions incorporate feedback to regulate housing and apartment sales while preventing exploitation of ceiling exemptions.

If enacted, the law is expected to facilitate more structured and legally compliant housing and apartment sales, clearing the way for developers to resume stalled projects while protecting buyers’ rights.