Need to merge all poli­cies to ad­dress hous­ing short­age

HT Estates - - HTESTATES - Shubhran­shu Pani HT Es­tates Cor­re­spon­dent

In the last decade, there has been a lot of fo­cus on and in­ter­est in green com­mer­cial build­ings from global and In­dian cor­po­rates. This in­creas­ing in­ter­est has led to an ac­cel­er­ated avail­abil­ity of green build­ing prod­ucts, ser­vices and also en­thu­si­asm from builders cater­ing to this seg­ment.

There has also been a sig­nif­i­cant in­crease in ‘ green’ growth in the res­i­den­tial seg­ment. There are now in­vestors such as In­ter­na­tional Fi­nance Cor­po­ra­tion, UK gov­ern­ment’s Depart­ment of In­ter­na­tional D eve l o p m e n t ( D F I D ) a n d the Na­tional Hous­ing Bank in­volved, which is sig­nif­i­cantly boost­ing this seg­ment.

To­day, many more In­dian de­vel­op­ers have un­der­stood that green cer­ti­fi­ca­tion can at­tract more cus­tomers and in­vestors, and are align­ing them­selves with green con­cepts. How­ever, the sup­ply gap is still quite sig­nif­i­cant, and there is still a def­i­nite need to cre­ate a broader spec­trum of aware­ness among end-users.

Another la­cuna is on the bank­ing front. Bank loans are an in­te­gral fac­tor driv­ing the res­i­den­tial prop­erty mar­ket, and un­less bankers and lend­ing agen­cies are trained on the ben­e­fits and im­por­tance of green real es­tate and in­sist on such fea­tures, we will not see aware­ness and trac­tion of sus­tain­able prop­er­ties in­crease much.

In com­mer­cial prop­er­ties, there needs to be more clar­ity on who reaps the ben­e­fits – the owner or the ten­ant. In view of this, codes have to be made manda­tory. The En­ergy Con­ser­va­tion Build­ing Code has to be sim­pli­fied, and the state gov­ern­ments have to en­sure that it is made manda­tory by all con­cerned lo­cal bod­ies. The way things are now, lo­cal ur­ban bod­ies do not have the where­withal for im­ple­men­ta­tion.

In­dis­putable ben­e­fits

Green build­ing con­cepts, when im­ple­mented to the re­quired ex­tent and in­tent, will help save wa­ter through rain­wa­ter har­vest­ing and re­cy­cling of waste wa­ter, and in reap­ing ben­e­fits from the wa­ter en­ergy nexus. The com­pounded an­nual growth rate of elec­tric­ity in the res­i­den­tial seg­ment is over 8%. One-third of elec­tric­ity used in the coun­try is for res­i­den­tial and com­mer­cial build­ings. Whether it is wa­ter or en­ergy, one can eas­ily achieve ben­e­fits to the tune of 25% or more.

Green build­ings also ad­dress the ma­jor con­cern area of waste dis­posal in most of In­dian ci­ties. We al­ready face de­creas­ing avail­abil­ity of land­fill sites in th­ese ci­ties, and green build­ings with their in­te­grated waste dis­posal and re­cy­cling sys­tems can con­trib­ute sig­nif­i­cantly to­wards de­creas­ing de­pen­dence on them.

In­cen­tives and con­ces­sions

Cur­rently, In­dian ci­ties that of­fer in­cen­tives and con­ces­sions for green build­ing devel­op­ment and use in­clude Kolkata, Noida, Hy­der­abad and Pune. Ex­am­ples of such in­cen­tives in­clude higher FAR and prop­erty tax in­cen­tives by Greater Hy­der­abad Mu­nic­i­pal Cor­po­ra­tion, the Pune eco-hous­ing pro­gramme, etc. Link­ing prop­erty tax to ac­tual per­for­mance and man­dat­ing a sim­pli­fied re­gion-spe­cific list will help achieve at­tain green goals faster and in more ci­ties.

A holis­tic ap­proach is prefer­able to a piece-meal ap­proach. The pos­i­tive im­pacts will ac­crue faster when green con­struc­tion pa­ram­e­ters are made manda­tory and im­ple­mented by all con­cerned stake­hold­ers like ur­ban lo­cal bod­ies (mu­nic­i­pal­i­ties and devel­op­ment au­thor­i­ties), builders, own­ers, ten­ants, elec­tric­ity dis­tri­bu­tion com­pa­nies, pol­lu­tion con­trol bod­ies, wa­ter sup­ply and sew­er­age de­part­ments, and state and Cen­tral gov­ern­ments.

Rat­ing and cer­ti­fi­ca­tion

To­day, there are a num­ber of rat­ing and cer­ti­fy­ing agen­cies for green con­struc­tion ex­ist­ing in In­dia. Th­ese in­clude In­dian Green Build­ing Coun­cil, US Green Build­ing Coun­cil (EDGE Pro­gram), Green Globes, Eco Hous­ing pro­gramme and MNRE’s GRIHA. Al­most all of the cer­ti­fi­ca­tion pro­grammes have com­mon el­e­ments of fo­cus, and the ben­e­fits of sav­ings in en­ergy and wa­ter, and us­ing lo­cal ma­te­ri­als are in­vari­ably achieved.

The time is now

There is no ques­tion that pop­u­la­tion growth in most parts of the ur­banised and ur­ban­is­ing world is ex­ceed­ing th­ese ar­eas’ abil­ity t o ac­com­mo­date i t . Un­sus­tain­able growth in­evitably leads to en­vi­ron­men­tal changes which, if they can­not ac­tu­ally be re­versed, at least must be slowed down. The onus of re­duc­ing en­vi­ron­men­tal degra­da­tion ob­vi­ously does not fall solely on the shoul­ders of sus­tain­able real es­tate. How­ever, green build­ings are def­i­nitely an ob­vi­ous avail­able so­lu­tion, since de­sign­ing and build­ing real es­tate which re­sults in lower emis­sions is in ev­ery de­vel­oper’s reach to­day. It is only a ques­tion of will­ing­ness.

In a mas­sively pop­u­lated and in­creas­ingly pop­u­lat­ing coun­try like In­dia, the gov­ern­ment is al­ready se­verely chal­lenged in mak­ing ba­sic re­sources like wa­ter and elec­tric­ity avail­able and man­ag­ing waste. The sit­u­a­tion will not im­prove with­out proac­tive in­ter­ven­tion, and in fact only worsen. Sus­tain­able real es­tate can make a sig­nif­i­cant dent in this re­source deficit if it is de­ployed in the re­quired mag­ni­tude.

The union gov­ern­ment should try to merge var­i­ous poli­cies at a point to ad­dress hous­ing short­age is­sue in In­dia, an As­socham- JLL joint study has said.

It sug­gested that the Prad­han Mantri Jan Dhan Yo­jana, which mainly tar­geted low­erend of pyra­mid, should be used to pro­vide hous­ing fi­nance to peo­ple who held bank ac­counts, thereby di­rectly cater­ing to the tar­geted seg­ment.

The study ti­tled ‘Af­ford­able Hous­ing Fi­nance in In­dia,’ said eco­nom­i­cally-weaker sec­tions (EWS) and low-in­come group ( LIG) cat­e­gories were gen­er­ally not given ac­cess to loans be­cause of many rea­sons such as lack of proper doc­u­men­ta­tion, higher credit and de­fault risk, un­avail­abil­ity of guar­an­tor and oth­ers.

Be­sides, i ncome of t his cat­e­gory was ei­ther un­even through the year or is be­low the ‘vi­able thresh­old,’ to en­sure re­pay­ment of loan.

Ab­sence of a de­vel­oped mar­ket for fi­nanc­ing home- buy­ing re­sulted in lack­lus­tre sup­ply be­cause de­vel­op­ers of af­ford­able hous­ing faced a slow­down in ab­sorp­tion of con­structed units, the study high­lighted.

Devel­op­ment of af­ford­able hous­ing has con­sis­tently been a chal­lenge be­cause of land cost and avail­abil­ity, prac­ti­cal­ity of af­ford­able hous­ing def­i­ni­tion, com­pli­cated reg­u­la­tory process for ap­provals and oth­ers. “Re­lax­ing the norms specif­i­cally for af­ford­able hous­ing seg­ment can boost the depth and width of hous­ing fi­nanc­ing mar­ket,” sug­gested the study. Ac­tor Vivek Oberoi has launched an af­ford­able hous­ing project in Sha­ha­pur, Ma­ha­rash­tra un­der the um­brella pro­gramme Mis­sion 360. The project will pro­vide af­ford­able hous­ing to more than 15,000 fam­i­lies.

Sha­ha­pur is the first af­ford­able hous­ing project of Karrm In­fra­struc­ture Pvt Ltd that has a tar­get to con­struct five lakh apart­ments within the next three to five years. The com­pany will an­nounce seven more af­ford­able hous­ing projects over the next quar­ter.

Vivek Oberoi, pro­moter and part­ner, Karrm In­fra­struc­ture Pvt Ltd says, “Karrm’s af­ford­able hous­ing projects hope to im­prove the liv­ing con­di­tions of the poor and un­der­priv­i­leged fam­i­lies.” The sec­ond edi­tion of In­ter­na­tional Real Es­tate Expo (IREX) will be held from Oc­to­ber 7 to 9, 2016 at Ashok Ho­tel, New Delhi.

IREX is an an­nual show that presents in­vest­ment av­enues for high net worth and wealthy in­di­vid­u­als who in­tend to in­vest in in­ter­na­tional real es­tate and premium lux­ury prop­er­ties.

IREX 2016 will have par­tic­i­pa­tion of lead­ing in­ter­na­tional real es­tate de­vel­op­ers and mar­ket­ing com­pa­nies and is ex­pected to draw more than 5000 vis­i­tors. It will present in­vest­ment op­por­tu­ni­ties in res­i­den­tial, com­mer­cial, re­tail and leisure sec­tors. Some ma­jor par­tic­i­pants are Da­mac Prop­er­ties, Al Mar­jan Is­land and Rak Prop­er­ties from UAE among oth­ers.

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