What hap­pens to un­sold hous­ing stock?

Ad­di­tional hous­ing stock cre­ated by smart cities will add to the ex­ist­ing un­sold in­ven­tory of 7 lakh units

HT Estates - - FRONT PAGE - Van­dana Ram­nani

De­vel­op­ers around the coun­try are cur­rently grap­pling with a huge un­sold stock of 7 lakh units. What hap­pens then to the ad­di­tional hous­ing stock cre­ated as part of the area-based de­vel­op­ment (ABD) plans as part of the Smart Cities Mis­sion?Won’t it just add to the num­bers?

About 89% of the ₹ 48,220 crore to be in­vested in the first 20 smart cities will be spent on the built en­vi­ron­ment that will in­clude ur­ban de­vel­op­ment and hous­ing. Ac­cord­ing to a white pa­per re­cently re­leased by The Royal In­sti­tu­tion of Char­tered Sur­vey­ors (RICS) ti­tled Ur­ban Make over: Evo­lu­tion or Rev­o­lu­tion? the top three cities in­vest­ing in the built en­vi­ron­ment in­clude Bhubaneswar, In­dore and Ja­balpur. In­dore ex­pects to con­struct 1.94 mil­lion sq m and Ja­balpur 1.97 mil­lion sq m of green build­ings space.

Though it’s too early to fore­cast how much ad­di­tional hous­ing or com­mer­cial realty stock will get cre­ated in the smart cities as part of ABD, plan­ners will have to en­sure that both mid-seg­ment as well as af­ford­able op­tions are made avail­able to buy­ers. This is im­por­tant be­cause most of the re­de­vel­op­ment is planned for ar­eas lo­cated in the heart of the city and not in the pe­riph­ery, thus mak­ing real es­tate ex­pen­sive.

Ac­cord­ing to data avail­able, Bhubaneswar will have 3,800 hous­ing units with an av­er­age area of 1,000 sq ft for gov­ern­ment staff and four slum re­de­vel­op­ment projects with 6,000 hous­ing units for low in­come house­holds. AtAhmed­abad, hous­ing for about 8,000 slum dwellers will be de­vel­oped and Coim­bat­ore will have about 4,500 hous­ing units.

Both Bhopal and Su­rat will lever­age ₹ 1,000 crore from real es­tate under ABD. Both cities will also have to set aside 15% of hous­ing stock for the eco­nom­i­cally weaker scheme, says Amit Bhatt, strat­egy head, ur­ban trans­port, EM­BARQ In­dia.

₹ 1,000 crore will be used in Bhopal as seed cap­i­tal and ₹ 1,500 crore will be lever­aged from the private sec­tor when shops and hous­ing will be built on the 100 acres of green­field pro­ject. Re­de­vel­op­ment will cre­ate real es­tate that will be amor­tized to raise money for de­vel­op­ment of the city, says Bhatt.

Jitesh Brahmk­sha­triya, gen­eral man­ager, head, master plan­ning, Tata Con­sult­ing En­gi­neers Lim­ited, says that smart cities plan­ning to cre­ate hous­ing and com­mer­cial stock to raise rev­enue should keep in mind the af­ford­abil­ity as­pect.

I STOCK SOURCE: RICS

About 89% of the 48,220 crore to be in­vested in the first 20 smart cities will be spent on the built en­vi­ron­ment that will in­clude ur­ban de­vel­op­ment and hous­ing.

Newspapers in English

Newspapers from India

© PressReader. All rights reserved.