Even as the Indian government has been advancing the cause of affordable housing, whether the housing projects are affordable at all remains the key question.
Affordable housing was included in the category of commercial infrastructure in India last month by the Union Ministry of Finance. This was hailed as a move that could boost private-public partnership among other reforms, resulting in a push for the housing sector. As requirements for over 20 million homes fall short currently, the government of India has envisioned ‘Homes for All’ by 2022. The Confederation of Real Estate Developers’ Association of India, or CREDAI’s recent announcement of partnership with the government to develop affordable housing through the country is a significant step forward. However, as the understanding of affordable housing remains non-reflective of realities, who benefit from these schemes remain to be seen.
Affordability as a concept remains subjective to context, dependent on various socioeconomic factors. In the housing sector, the government has taken special measures with the launch of schemes such as the Pradhan Mantri Awaas Yojana, which hopes for providing housing for all by 2022. Income and dwelling size are said to determine eligibility and access to the benefits associated to ‘affordable housing’. The notification conferring affordable housing an infrastructure status defined the same as 30 square metre and 60 square metre carpet area dwellings, in four metropolitan cities of India and the rest of the country respectively. Yet, the conferring of the infrastructure tag comes as a boon to builders, particularly, through various sops such as decreased loan rate and tax concessions, which are set to bring down the overall cost of construction. There are hopes that these benefits will trickle down to the buyer. However, without adequately taking into consideration the skyrocketing property rates particularly in urban areas and other socioeconomic factors, the idea of affordability is lost in definition.
— Rahul Nahar (@RahulNaharXrbia) April 16, 2017
In a recent announcement, CREDAI informed about the launch of several housing projects around India, which will amount to 200,000 dwellings. The western Indian city of Maharashtra is looking at gaining approximately 1oo,ooo dwellings. CREDAI is also looking at a possible collaboration with the State Bank of India (SBI), to create special financial packages both for home loans and and for financing of construction, the realtors’ body said in a release.
Lower income groups and economically weaker sections of society, particularly, in urban areas, are the target group when it comes to making policies relating to affordable housing. A report by Deloitte, titled ‘Mainstreaming Affordable Housing in India’, stated, “High land costs, delay in project approvals, increasing raw material costs and low profit margins have made low-cost housing projects less attractive to the private developers. Also, housing (including Affordable Housing) being a state subject creates complexities in implementation because of precarious financial condition of development authorities, state/city-level agencies and their limited capacities in handling in these projects.”
Highlighting the achievement of the government, the report also seeks for action beyond partnerships that are simply not efficient enough. It also adds, “The collective agenda must advance the efficiency of affordable housing sector at an optimally low cost, while maintaining safety standards and basic amenities.” Whether price regulation and government initiative in the actual building of homes for the marginalised sections of society is a more viable alternative to the current model is to be thought about. Rising land prices, large distance of dwellings from city centres, lack of awareness among probable beneficiaries and other such concerns remain. By taking refuge in ambiguous definitions of affordability, the dream of Housing for All seems quite a distant one.