Largescale, affordable housing projects needed

The recently-announced Union Budget 2017-18 has yet again emphasised the importance of housing, and has accorded infrastructure status to this sector. The traditional factors influencing housing demand keep fluctuating due to policy interventions; yet, consumers keep investing in real estate. This is evidenced by the fact that housing sales velocity has not dropped significantly anywhere in India due the various policy reforms. 

Of all the policy initiatives, the Housing for All (Pradhan Mantri Awas Yojana) and the Smart Cities Mission are two major flagship policies that have affected the demand and supply trends of residential real estate, and have a huge impact on addressing the issues of informal housing / housing for the urban poor. The recent Real Estate Regulatory Act (RERA) does not concentrate on incentives to  promote informal housing, though it increases transparency in the formal residential market. 

Affordable housing shortage continues to be a major concern in the country today, and can be correlated with the rate of urbanisation taking place. According to the Census of India 2011, India’s urban population increased to 377 million, reflecting the rise in urbanisation from 27.8 per cent to 31.2 per cent between 2001 and 2011. This rate of urbanisation has led to many issues such as land shortage, housing shortfall, severe pressure on available infrastructure, transportation deficits and stress on basic amenities like water, sanitation and healthcare. 

At present, there is a shortage of 18.8 million homes across urban centers of India, of which 15 million are needed in the LIG (Low Income Group) category. Large-scale budget housing projects are definitely the need of the day to address the mammoth shortfall. The Housing for All mission envisions a multitude of strategies such as tax rebates, monetary support, relaxed development regulations, discounted interest rates, etc. to provide Housing for All by 2022.