AFFORDABLE HOUSING IN INDIAAN INCLUSIVE APPROACH TO SHELTERING THE BOTTOM OF THE PYRAMIDSubmitted to : ms vijayaSubmitted by:B.PRAMOD KUMAR10011BAO25B.TECH(PLG),VI SEMJNA&FAU,SPARESEARCH BY:Jones Lang LaSalleYEAR:2012
AFFORDABLE HOUSING IN INDIAUrbanisation and Housing Shortage in India. As per 2011 census, the country had a population of 1,210.98million, out of which, 377.10 million (31.16%) lived in urbanareas. During 2001-2011, the urban populationof India grew at a CAGR of 2.8%, resultingin the increase in level of urbanisation from27.81% to 31.16%. This growing concentration of people in urban areas has led toproblems of land shortage, housing shortfall and congested transitand has also severely stressed the existing basic amenities such aswater, power and open spaces of the towns and cities.
AFFORDABLE HOUSING IN INDIA According to the 2011 census, the housing stock in urban Indiastood at 78.48 million for 78.86 million urban households. Urbanisation has resulted in people increasingly living in slums andsquatter settlements and has deteriorated the housing conditions ofthe economically weaker sections of the society. According to estimates of the Technical Group constituted by the Ministryof Housing and Urban Poverty Alleviation (MHUPA), the urban housingshortage in the country at the end of the 10th Five-Year Plan wasestimated to be 24.71 million for 66.30 million households. The group further estimated that 88% of this shortage pertains to housesfor Economically Weaker Sections (EWS) and another 11% for Lower-Income Groups (LIG).For Middle- and High-Income Groups (MIG andHIG), the estimated shortage is only 0.04 million.
AFFORDABLE HOUSING IN INDIASource: Report of the Technical Group (11th Five Year Plan: 2007-12) onEstimation Of Urban Housing Shortage.INFERENCE: housing percentage shortage in EWS is 99.9 % which is doublethan the estimated number of households.Where as in HIG and MIG it is so less 0.2% only.
AFFORDABLE HOUSING IN INDIAAffordable Housing Defined: There is no clear-cut definition of the term ‘affordable’, as it is arelative concept and could have several implied meanings indifferent contexts. According to the RICS Report on Making Urban Housing Work inIndia, affordability in the context of urban housing means provisionof ‘adequate shelter’ on a sustained basis, ensuring security oftenure within the means of the common urban household. According to the Task Force on Affordable Housing set up bythe MHUPA in 2008, affordable housing for various segments isdefined by size of the dwelling and housing affordability derived bythe household income of the population
AFFORDABLE HOUSING IN INDIADefinition of Affordable Housing – MHUPA (2011) According to the KPMG Report on ‘Affordable Housing – A Key Growth Driver in theReal Estate Sector’, affordable housing is defined in terms of three mainparameters, namely income level, size of dwelling unit and affordability.
AFFORDABLE HOUSING IN INDIAJones Lang LaSalle’s Definition of AffordableHousing. Minimum volume of habitation. Provision of basic amenities. Cost of the house. Location of the House.
ISSUES IN THE DEVELOPMENT OFAFFORDABLE HOUSING Developing affordable housing in Indian cities faces significantchallenges due to several economic, regulatory and urban issues. Excessive Control on Development of Land Creates ArtificialShortage. Lack of Marketable Land Parcels. Titling Issues and Lack of Information. Rising Threshold Costs of Construction. Lack of Access to Home Finance for Low-Income Groups.
ISSUES IN THE DEVELOPMENT OFAFFORDABLE HOUSINGRegulatory ConstraintsLengthy Approval and Land Use Conversion Process The process of real estate development is particularly affected bythe efficiency of urban local bodies, which undertake city planning,deliver utility services and regulate controls on development throughapprovals. India is ranked 177 out of 183 countries with respect to dealing withconstruction permits2, which indicates the challenge developers face inIndia in development of real estate. Lack of Clarity in Building Bylaws and Guidelines. Continuation of Archaic Laws
ISSUES IN THE DEVELOPMENT OFAFFORDABLE HOUSINGMultitude of Statutory Approvals adds 2-2.5 Years to the Pre-Construction ProcessINFERENCE:construction process of statutory approvals adds 2-2.5 years in india
POLICY FRAMEWORK ANDREGULATIONS FOR AFFORDABLEHOUSINGCentral Level Schemes National Urban Housing and Habitat Policy (NUHHP), 2007 Jawaharlal Nehru National Urban Renewal Mission (JNNURM) Basic Services for the Urban Poor (BSUP) Integrated Housing and Slum Development Programme. Interest Subsidy Scheme for Housing the Urban Poor (ISHUP). Rajiv Awas Yojana.
THE PRIVATE PLAY TOAFFORDABLE HOUSING IN INDIA
MAJOR HUBS OF AFFORDABLEHOUSING DEVELOPMENT Location of Projects and Their Distance from City Centre Mumbai and NCR have affordable housing projects located 65–75 kmaway from the city centre. On the other hand, Ahmedabad and Kolkataprovide better proximity, with projects located at a distance of 15–20 kmfrom the city centre. Bangalore, Pune and Chennai also have projects after a distance of25–30 km from the city centre. Major Developers in the Segment Amongst the developers, Tata Housing (Shubh Griha) and VBHC areentirely focused on low-income affordable housing and have alreadylaunched multiple projects across cities. Mahindra Lifespaces, TVS Housing
INCOME LEVELS AND HOUSINGAFFORDABILITYDisposable Surplus for House Purchase in Various Income GroupsINFERENCE:percentage of surplus of income is high when compared withothers.
SENSITIVITY OF RENT AS PERCENTAGE OF INCOME FORPERSONS OF VARIOUS INCOME GROUPSINFERENCE:rent as a percentage of income is less for income group 2-3 lakhsand it is high in income groups income 1000000 more.
DEMAND-SUPPLY DYNAMICS OF HOUSING FOR VARIOUSINCOME GROUPSSource: john lang lasalla ResearchINFERENCE:Share of demand is high for income group 2-3 lakhs per annumand supply is low when compared to other income groups.
HOME LOAN DISBURSALS BY HOUSING FINANCE COMPANIES(HFCS)INFERENCE:The home loan for above 10 lakhs is more every year.
ESTIMATED CONSTRUCTION COSTS FOR LOW-INCOMEHOUSINGINFERENCE:for one sq ft ,the selling price will be Rs 1,400 to 1,700.
The Landscape of Affordable Housing Development (units priced < INR 10Lakhs) in Major Indian Cities
MAJOR HUBS OF AFFORDABLEHOUSING DEVELOPMENTINFERENCE: distance from centre of the city plays an important role creatingaffordable housing hubs .
NEWS PAPER ARTICLESMHADA joins hand with privatedevelopers.Activities of affordable housingby NGO.
CONCLUSION Historically, housing for the poor and the economically weaker sectionsof the society ( EWS) has been provided by the government undervarious welfare schemes. Nevertheless, this is insufficient compared to the existing shortage inthe segment," says report on urbanization and housing shortage inIndia by Jones Lang LaSalle India. The main reasons for rise in shortage in affordable housing on thesupply side is lack of availability of urban land, rising construction costsand regulatory issues while lack of access to home finance for lowincome groups are constraints on the demand side.