How to make the most of the af­ford­able hous­ing boost

Hindustan Times (Chandigarh) - Estates - - FRONT PAGE - Ashwini Ku­mar Sharma ashwini.s@htlive.com

To get sub­sidy un­der Prad­han Mantri Awas Yo­jana (Ur­ban), the car­pet area has been in­creased by 33%. Ex­perts share how af­ford­able hous­ing can be made more at­trac­tive:

ROPE IN PRI­VATE SEC­TOR UN­DER PPP

The ini­tia­tive, ‘Hous­ing for All by 2022’ is the cen­tral pivot around which the gov­ern­ment’s ef­forts are con­cen­trated.

This, in turn, cov­ers dif­fer­ent as­pects like rental and af­ford­able hous­ing.

Rop­ing in the pri­vate sec­tor un­der the Pub­lic-Pri­vate Part­ner­ship (PPP) model is the key to im­prov­ing the seg­ment.

Among other ini­tia­tives, the gov­ern­ment needs to grant in­fra­struc­ture sta­tus to the en­tire real-es­tate in­dus­try mak­ing longterm fi­nanc­ing easy for the in­dus­try; fix GST rate for all types of hous­ing at 6%; re­vise car­pet area to 60 sq mt in­clud­ing in metro cities to qual­ify for sub­sidy; make land avail­able at sub­sidised rates; re­duce pre­mium on ad­di­tional floor space in­dex (FSI) to en­cour­age af­ford­able hous­ing in metro cities and also re­duce time taken and cost of per­mis­sions and clear­ances.

To make af­ford­able hous­ing hap­pen, we need to work on the mass hous­ing model, bring­ing economies of scale into the pic­ture.

Ni­ran­jan Hi­ranan­dani, pres­i­dent (na­tional), NAREDCO and CMD, Hi­ranan­dani Com­mu­ni­ties

PER­MIT HIGHER FLOOR SPACE IN­DEX

Land in met­ros forms a sig­nif­i­cant pro­por­tion of the project cost and ren­ders such projects un­vi­able for the af­ford­able seg­ment. Poli­cies should be for­mu­lated wherein land can be pro­vided at rates that make projects vi­able.

Land can be pro­vided to de­velop com­pos­ite projects where one seg­ment, say, the lower in­come group is cross sub­sidised by the rev­enues earned from the other seg­ment say higher in­come group. Sig­nif­i­cant land banks across re­gions can be iden­ti­fied by agen­cies. If such cor­ri­dors al­low for high den­sity de­vel­op­ment, a higher FSI can be per­mit­ted, with an in­cre­men­tal ben­e­fit of FSI be­ing ap­plied to­wards af­ford­able hous­ing. The gov­ern­ment should pro­vide in­cen­tives to pri­vate play­ers who use tech­nol­ogy to deliver qual­ity prod­uct.

Shub­ham Jain, sec­tor head cor­po­rate sec­tor rat­ings, ICRA

RE­WARD DE­VEL­OP­ERS FOR LAST MILE CON­NECT

Avail­abil­ity of land in cities at af­ford­able pric­ing is one of the ma­jor chal­lenges. The gov­ern­ment could fa­cil­i­tate the de­vel­op­ment of af­ford­able hous­ing by mak­ing sur­plus land held by PSUs (Pub­lic Sec­tor Un­der­tak­ings) avail­able for af­ford­able hous­ing projects. Land is a state sub­ject which adds a layer of com­plex­ity. The cen­tral gov­ern­ment should guide the states on pro­grammes to al­lo­cate and in­cen­tivise the use of land for af­ford­able hous­ing, while also in­cen­tivis­ing state gov­ern­ments to fa­cil­i­tate en­gage­ment and im­ple­men­ta­tion.

De­vel­op­ers should get in­cen­tives for in­fra­struc­ture and last­mile con­nec­tiv­ity de­vel­op­ment in semi-ur­ban cen­tres. It can be through an in­crease in FSI or re­duc­ing stamp duty or tax In­fra­struc­ture up­grad­ing pre­cedes the FSI in­crease to en­sure that ex­ist­ing house­holds are not ad­versely im­pacted due to the new de­vel­op­ment.

Joe Vergh­ese, man­ag­ing di­rec­tor, Col­liers In­ter­na­tional In­dia

ALLOT LAND PARCELS AT SUB­SIDISED COSTS

We be­lieve the re­cent move to raise the car­pet area and the RBI’s re­vi­sion of hous­ing loan lim­its for pri­or­ity sec­tor lend­ing (PSL) el­i­gi­bil­ity will help bring most of the un­der-con­struc­tion dwelling units in ur­ban In­dia un­der the purview of the CLSS.

Most of the im­pact is likely to be felt in the pe­riph­eral lo­ca­tions of Tier I, II and III cities, where the size of units are larger. This will not only bol­ster home­buyer sen­ti­ments, but also fur­ther pro­pel con­struc­tion ac­tiv­ity in the af­ford­able hous­ing sec­tor.

How­ever, the next steps for the gov­ern­ment should be to look at the ben­e­fits for de­vel­op­ers. El­e­ments like re­duc­tion in con­struc­tion in­puts should now be a pri­or­ity.To make op­ti­mum use of the ini­tia­tive, the land al­lot­ment should be at bet­ter lo­ca­tions and sub­sidised costs. Fo­cus should be on build­ing a holis­tic en­vi­ron­ment that in­cor­po­rates in­fra­struc­ture and so­cial fa­cil­i­ties.

An­shu­man Mag­a­zine, chair­man, In­dia and South East Asia CBRE

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