Affordable Housing - The
Increasingly Complex Indian Scenario..!
- by Mr. Anil
Pharande, Chairman - Pharande Spaces
Cost-effective housing
is a key problem in all developing countries, but India definitely
presents a remarkable case study.
While India's
constantly expanding population is the bedrock of its economic promise, it is
also the source of any number of issues - not least of all housing deficit.
Massive deficit of budget homes in India
The country's
population is likely to be in the neighbourhood of 600 million by the year
2030. There is a huge existing and future requirement for affordable homes.
So far, the attempts
of the Government to breach this gap have not been very successful.
However, in all
fairness, addressing the massive deficit of budget homes in India is a
Herculean task which cannot be the sole responsibility of the Government.
CREDAI
The only real option
is to rope in private sector involvement. The recent announcement that CREDAI
is launching 375 affordable housing projects across India is indeed welcome,
but we must keep in mind that the deficit in this segment currently hovers
between 18-20 million units.
The country's
residential developers have definitely woken up to the fact that affordable
housing is where the greatest demand currently is - not only from end-users but
even from investors.
What they are doing
about creating the required inventory depends a lot on which city and in which
areas they operate in, and whether or not they have the requisite technical
knowledge and bandwidth for such housing.
Obviously, developers
who have been concentrating their efforts mostly on the cheaper outskirts of
cities will have such knowledge, as such areas primarily see demand for
affordable housing. Developers who have so far been concentrating more on
middle-income and premium housing have a greater challenge on their hands.
In the first place,
they often lack the expertise for successfully carrying our budget housing
projects. Such expertise must encompass the ability to scientifically balance
residential spaces with a good saturation of common amenities and facilities.
They must also have a
good working relationship with municipal authorities who handle affordable
housing to get expedited clearances for their projects and need access to land
parcels in the right locations.
Reinventing mid-income housing into budget housing..!
Simply reinventing
mid-income housing into budget housing is not a real answer in most cases, as
the project may be in a location which commands higher land rates. This means
that the buyer ends up paying premium location charges, which is not feasible
for budget housing. Also, some developers simply do not want to be known for
affordable housing projects because they have worked hard to build up a
'premium' label for their brand.
Meanwhile, slum
rehabilitation or / SRA projects is an extremely tedious and complicated affair
which is beyond the scope of many players who are not used to this route of
development.
It involves obtaining
the consent and willingness of the existing residents of such areas, and
overcoming various hindrances from local politicians who have their own
interests in unregulated housing such as slums and tenements.
Also, even if all the
consents are obtained and hindrances overcome, there is still the question of
relocating the existing residents until the new project is complete.
All these are some of
the reasons why there is probably no foreseeable solution to recreating areas
like Dharavi in Mumbai into organized affordable housing locations.
Huge land parcels available
One solution to boost
the available supply of affordable housing which requires determined Government
intervention is the release of land held by various Government agencies like
the Railways Authority of India. There are huge land parcels available in areas
where affordable housing is needed the most.
The Government can and
must consider this option if it feasibly intends to realize its aim to provide
Housing for All by 2022.
Another means
available is the creation of Special Residential Zones (SRZs) on the lines of
SEZs, with all the implied benefits and tax breaks for both developers and
buyers of housing in such zones.
About The Author:
Anil Pharande is
Chairman of Pharande Spaces, a
leading construction and development firm that develops township properties in
West Pune.
Pharande Promoters & Builders, the flagship company of Pharande
Spaces and an ISO 9001-2000 certified company, is a pioneer in the PCMC area
offering a diverse range of real estate products catering especially to the 42
sectors of Pradhikaran.
The luxury township
Puneville at Punavale in West Pune is among the company's latest premium
offerings. Woodsville in Moshi is another highly successful PCMC-based township
by Pharande Spaces
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