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Affordable housing: Hope against hope


vineetsinghAs demand for housing in India is literally going through the roof, ensuring maximum optimisation of technology, timely approvals of projects, single-window clearances, transparency, subvention of housing schemes and reducing interest rates are the need of the hour to meet the specific demand for affordable housing in the country, writes Vineet Singh.

With the real estate scenario in the country undergoing a sea change for last two years, strong demand for affordable homes has pulled back by overall economic slowdown. With sky-rocketing property prices, rising inflation, tight monetary policies and increasing costs, the sector has taken a beating. However, the demand continues to be strong in some way or the other, particularly in the affordable segment, unmatched with the supply.

The last two years have witnessed a cascade of numerous issues and challenges in the realty domain. It is expected that in the coming time, the loopholes will be addressed by policymakers, home finance sector which in turn would boost the real estate sector.

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To start with, the real estate sector in National Capital Region (NCR) is witnessing a strong demand, especially from the age group of 24-35 years for affordable homes. This is because around 70 per cent of the NCR working population has migrated from various regions of the country and is forced to pay huge amount out of their salary as the house rent.

As per our data the searches on the site under the Rs 25-lakh budget category is maximum, standing at 41 per cent during the July to December 2012 period. The second most popular category is Rs 25-50-lakh budget range with 29 per cent users are searching in this type. The Rs 50-75 lakh-budget range, however, comes in third category in the search statistics.

The reason for the slowdown is not related to some indigenous issues; rather, it is due to monetary factors such as high interest rates on lending, inflation and slowdown in construction projects. To sum it up, the factors afflicting growth are: strict monetary regulations due to high inflation, the Reserve Bank of India’s (RBI) apathy on releasing funds and making home loans difficult for consumers and high property prices.

The government’s interference in this issue will go a long way in addressing problems of the housing demand and contribute to the supply of affordable homes. The turnaround could be seen if solutions like timeliness of project approvals, single window clearances, transparency, subvention of the housing schemes and reducing interest rates are implemented in a proper manner.


The reports related to the housing demand reveal that there is a shortage of about 270 lakh dwelling units and by 2025, shelter would be a matter of huge concern for about 50 crore people. The demand for affordable homes is real but supply can only catch up if the government takes some proactive steps. The last two years have been good in terms of prices and transactions but this financial year is likely to bear the brun.

(The writer is Business Head of