Affordable Housing: Development, Problems and the Future
'Affordable housing conveys fiscal assortment, stability, and amplifies the quality of a neighborhood'.
How does the future outlook of affordable housing look?
Due to the sudden onset of the COVID-19 pandemic in 2020, the core of the real estate sector of India was affected massively. However, since the final quarter of the year, the segment of affordable housing has shown quite a positive response, to say the least. The interest in the same has increased massively, and the demand for it continues to grow even more. Over the last years, the residential segment was solely being dominated by the millennial that was looking for some chic options at sensible pricing. Nonetheless, the scenario has changed entirely this year, owing to the different housing schemes addressed by the Indian government. The list of the same includes – MHADA (Maharashtra Housing and Area Development Authority), PMAY (Pradhan Mantri Awas Yojana), and DDA (Delhi Development Authority Housing Schemes), and NTR Urban Housing Scheme, etc. Moreover, the importance of owning a home during a period of calamity has opened the eyes of many individuals as well. Hence, considering the favorable factors, the future of the affordable housing segment looks quite bright and ideal for investment.
What does an affordable housing customer look for when shuffling through properties?
In essence, affordable housing is considered to be fundamental for the well-being and overall health of an individual. Moreover, it also contributes to the smooth functioning of the economic system of both the family and the country. Due to this reason, the popularity of this particular has been uprising for the last few months. Nonetheless, when buying proper housing for their purpose, a customer tends to evaluate a few things first. To begin with, while choosing affordable housing, an individual would look for a robust value proposition first. As he/she already has limited earnings, their dwelling place would be one of their most significant investments in life. Thus, they will consider it as the most crucial and long-term welfare for their family. In addition to the proposition, the consumer would also mull over the connectivity of various locations, such as different urban centers, commuting stations, and many more. Last yet not least, a well-constructed and -developed house will also need to have a robust security system, a dedicated playground, and an electrical supply. The importance of adequate sanitation, too, has become quite crucial in the era of COVID-19.
Do affordable housing owners face any residential-related challenges at all? If so, then what are they?
The provision of affordable housing has been quite a success in the Indian subcontinent. However, the consumers of the same still encounter several hurdles, which, in turn, affect their standard of living and the dream of cherishing a peaceful life. For affordable housing to be highly sustainable, it needs to be connected to all the important places in a city or a region. Nevertheless, in most cases, the development of affordable houses cannot be found in an area, which is heavily connected with the business districts. Furthermore, the commute system of the same tends to be pretty much inadequate as well. Besides, the cost of ownership can be yet another issue in this aspect too. For instance, in India, a house owner needs to pay various taxes, such as Stamp Duty, Service Tax, VAT, etc., for the property.
In most cases, the overall reimbursement of all these taxes constitutes around 35% of the actual home cost. Thus, for an average individual, it becomes almost impossible to pay for everything while looking after the well-being of his/her family. The government of the country has recently introduced various initiatives, such as LIG/EWS categories, and incentives for private players, which can be beneficial in this aspect. However, as of now, these schemes did not make much of a mark in the industry. So, the housing deficit challenge has still been quite prominent in the country.
Is the housing industry in India growing at all? What does the impending future hold for it?
Since the introduction of the National Housing Policy (1988), the government of India has attempted to reform the real estate sector of India prominently. However, various affordable housing planning and schemes were still underachieved due to the lack of sufficient progress. Nevertheless, the current scenario of the sector has been changed entirely. Currently, the notion of public-private affiliation is blooming and trying to take the segment of housing by storm. For example, the government of Maharashtra has recently made a pact with the private sectors of the region to construct around 1.1 million domiciles. The noble endeavor of the state government has also caught the eyes of the World Bank and has prompted them to form a partnership with them. In the meantime, the Shapoorji Pallonji Group also has the intention of building around 20,000 dwelling places within seven years under the brand name of Joyville. Moreover, Attibele, which is located approximately 35km away from the core of Bangalore, has emerged as an ideal hub for affordable housing too. Aside from these, VBHD, Tata Housing, and CSC Constructions are some of the other prominent names who have announced their housing project or, currently, are looking for land.
Reference
- https://www.weforum.org/agenda/2016/05/how-to-tackle-india-s-affordable-housing-challenge
- https://realty.economictimes.indiatimes.com/realty-check/affordable-housing-in-india-challenges-opportunities/976
- https://www.99acres.com/articles/the-future-of-affordable-housing-in-india-2.html
