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Difficulties Faced In The Development of Affordable Housing In India

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Difficulties Faced In The Development of Affordable Housing In India.

The development of affordable housing in India is an uphill task. The development process in Indian cities faces significant challenges due to several economic, regulatory and urban issues. Some major concerns are as follows:

Lack of Availability of Urban Land

With rapid urbanisation the population density is increasing day by day, there exists a huge demand for land in urban India. The real shortage has been further exacerbated artificially by poorly conceived central, state and municipal regulations. Due to this, land prices are much higher in urban areas which become a hurdle for mass real estate developments. Excessive Control on Development of Land Creates Artificial Shortage, lack of Marketable Land Parcels and lack of Information on land titles are certain factors that hinders the availability of urban land.

Rising Threshold Costs of Construction

The rising price of land and construction cost have a significant share in the price of affordable housing.  Affordable housing projects get more affected by rising costs of construction than premium projects, where the builder recovers his cost easily. It is very important that costs are minimised for construction of low-income housing.  There should be a balance between the amenities provided as well as ensuring the safety and serviceability of the built structure during its lifecycle.

Lack of Easy Finance options for Low income groups

Despite the availability of numerous financial institutions, banks and apex housing cooperative societies, there is a lack of easy access to home finance for low-income groups. The National Housing Bank, a fully owned subsidiary of the Reserve Bank of India, was set up primarily to accelerate housing finance activity in India and promote the Housing Finance Companies (HFCs) by providing them with financial support. However, there is still lot of difficulties that the LIG and EWS face while applying for financial support.

Regulatory Constraints

Several regulatory constraints also act as a barrier to real estate development in Indian cities. Lengthy approval processes, lack of clarity in urban planning etc. are few challenges that hamper the development of affordable housing. Development projects in Indian cities have to go through lengthy approval process, which results in delay in projects. It results in increased construction costs, which are borne by the buyer. In India, building bylaws and rules for Floor Space Index (FSI), zoning and development plans formulated by the Urban Local Bodies and Urban Development Departments lack clarity. This makes the construction process really difficult because acquisition of land parcels are done with a long-term view and such regulations sometimes get modified significantly after implementation of the project begins.

Extension of Outdated Laws

A lot of outdated laws, like the Rent Control Act, are still prevalent in India. It affects the redevelopment process of areas with older properties, which leads to further shortage of land to obsolescence and congestion.

Lack of Education

Education is a big factor, as people living in rural, underdeveloped, and slum areas are not educated enough to demand for good, healthy and affordable housing options.

Absence of Financial options for Developers

Not many developers are interested in the creation of affordable housing as there is no scope of income from the units. There are no special funding schemes or subsidies that are available at a large scale basis to attract the interest of more private builders.

The Govt. has taken significant steps to overcome this situation and encourage affordable housing in India. In the recent budget, the Govt. has given infrastructure status to affordable housing, which is viewed as a welcome move towards building affordable homes.

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NTR Housing Scheme In Full Swing: Chief Minister N. Chandrababu Naidu

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NTR Housing Scheme In Full Swing: Chief Minister N. Chandrababu Naidu

On Thursday, Andhra Pradesh Chief Minister N. Chandrababu Naidu said with the estimated expense of Rs. 5,556.74 crore, the construction of more than 2,44,164 houses, out of the proposed 3,03,044, has been commenced under the NTR Housing Scheme 2017.

While addressing the second day of the Collectors’ Conference he also said the construction of the remaining houses will begin soon. He mentioned that Prakasam and the Kurnool districts are ahead of the schedule in the urban housing scheme. Also, the works are in full swing in the Nellore and the Guntur districts under the rural housing scheme.

According to Naidu, the government will complete 2.5 lakh houses by January next year and another lot of two lakh houses by June.

By October 2, 2018, the state government intends to finish the construction of all the houses and plans to celebrate with massive house warming ceremony with local public representatives. This will help them set an example for housing schemes in other states.

Also Read: Raunak Group Presents Apna Pehla Ghar Campaign

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A Mumbai Suburbs’ Swift Transformation From Industrial To A Residential Zone: Wadala

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A Mumbai Suburbs’ swift transformation from industrial to a residential zone: Wadala

An industrial zone primarily, Wadala has undergone a drastic transformation in the past decade. Now an upcoming residential area, this Mumbai suburb is one of the seven islands to form the modern Mumbai. It is located on the Harbour line of Mumbai’s railway network.

Due to its proximity to BKC, large scale land development was inevitable, thus fueling the real estate market. Wadala is bordered by Dadar on the West, Matunga on the Northwest and Sewri on the South. Nestled between south Mumbai and the suburbs, Wadala enjoys strong connectivity by road and rail to most parts of Mumbai.

It has a number of flyovers like the Anik Panjrapol Link Road, Elevated road and Santacruz flyover. Thane, CST and Chembur are connected via the Eastern Highway while the Western Highway connects the locality to Bandra and Borivali. Wadala has the biggest bus depot in Mumbai. Furthermore, the multiple infrastructure initiatives like the monorail, Truck Terminal and the expansion of Highway are in various stages of development.

All this has given rise to residential demand and pushed the property value over the last few years. One of the most populated areas in Mumbai, Wadala has a large number of old temples, churches and dargahs, university campuses, schools, reputed hospitals and is also home to a former world’s largest IMAX dome theater. There are many stores, showrooms and malls around Wadala like the R Mall, High Street Phoenix and Palladium Mall.

Ramesh Nair, COO – business and international director, JLL India says, “A decade ago, property prices at Wadala were as low as Rs 2,800 per sq. ft. and it rose to Rs 14,000 a few years ago.”  As the infrastructure plans are on their way, so are the renowned developers like Ajmera, Dosti Group and Lodha Group among others.

Wadala at present offers one of the highest returns on real estate investments in the region. All the above-mentioned developers have their luxury projects in the area.

Ajmera I-Land introduces Aeon, Zeon and Treon towers with 2, 3 and 4 BHK plush homes. Conceptualized by renowned Singapore based Architects Space Matrix, these spaces with top-of-the-line lifestyle amenities exude exemplary class and finesse. The first residential floor begins at 110 feet from the ground level and offers several modern lifestyle amenities like kid’s pool, swimming pool, gymnasium, club house, open space and landscaped gardens, yoga room, kid’s play area and senior citizen corner.

Dosti Ambrosia is a 36-storey tower nestled in the 18 Acre Township of Dosti Acres. The architecture of the project was undertaken by renowned Hafeez Contractor in the 2 and 3 BHK apartments. It offers an exclusive rooftop swimming pool with 40,000 sq. ft. of landscaped gardens. You will find all modern conveniences like Gymnasium, Tennis Court, Indoor Badminton Court, Yoga and Meditation Room, Elderly Corner, Banquet Hall, Indoor Games, Indoor Badminton Court, Guest Rooms, Restaurant, Grand Entrance Lobby, Kids Play Area, 2 Club Houses and an Amphitheatre.

New Cuffe Parade by Lodha Group offers its residents all the comforts of a world-class lifestyle. The 2 and 3 BHK homes are spread in over 23 acres of land with 15 acres of stunning landscape and 75,000 sq. ft. of the club house. It includes 11 swimming pools, an organic farm, cricket pitch and multiple themed gardens. The buildings are designed by the world renowned WOHA in Singapore and the landscape was planned by Sitetectonix in Singapore.

Also Read: Mumbai to get Building Taller than Burj Khalifa, Road Bigger than Marine Drive

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Rajasthan Government May Hike The Affordable Housing Prices

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Rajasthan Government May Hike The Affordable Housing Prices

The prices of homes under the ambitious Mukhyamantri Jan Awas Yojana are expected to be increased by the state government.

According to the sources in the empowered committee meeting to be held on Monday, a proposal to increase the cost of a low-income group (LIG) and economic weaker section (EWS) houses will be proposed. Urban development and housing (UDH) minister Srichand Kriplani will chair the meeting. The LIG and EWS houses, presently are being constructed on government lands by private builders. These homes are sold at a fixed rate of Rs 1,250 per sq feet; out of which 1000 rupees per sq ft is given by Urban Improvement Trust (UIT), development authorities and local bodies to the builders.

According to provision 4(A) and 4(B), the developers are supposed to build EWS and LIG houses on government land. Seventy-five percent of such government land can be used in building EWS and LIG houses, while the remaining 25% can be sold by the developers. However, since the rates provided by the government are less the developers are not showing interest to construct houses under these categories. Sources said, “In Jaipur, not a single developer has shown interest in constructing houses under this model. The JDA has invited expression of interest (EOI) several times.”

The UDH is leaving no stone unturned to attract the builders in order to achieve the target of constructing 10 lakh houses by 2019. The sources mentioned, “As per the new proposal, the department has proposed to provide Rs 1,600 per sq feet rate to the developers. The land rates have increased subsequently over the period of time; this is why increasing rates has become a need of the hour.”

Sources further added, “The developers are constructing G+3 buildings at present. However, it is not cost-effective. It has been proposed to construct G+2 buildings for LIG and EWS category.”

Also Read: The Impact Of Regulations On The Real Estate Market

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