Affordable Housing a major issue affecting citizens of Mumbai


What is affordable housing?

In today’s scenario where urbanization is increasing rapidly and more and more people are migrating to metro cities like Mumbai in search of better opportunities, money, work or survival, resulting to this the city is getting crowded and there is huge scarcity of land. Venkaiah Naidu the new Union minister for Housing and Poverty Alleviation said, by 2020, 40 per cent of the population will be living in urban areas and by 2050, 50 per cent of the population will be living in urban areas. The people who migrate in cities are always in search for accommodation at affordable price, which can fit their pockets. Everyone seeks affordable dwellings but affordability is different for everyone, some can afford a home for Rs. 20 lakh, some can afford for Rs. 10 lakh. Affordability does not have any range it depends from person to person counting on their income, preferences. When it comes to affordable housing, accommodation is necessity and not luxury or investment.


As per the government those people who’s monthly family income is Rs 16,000-Rs 40,000 fall in the lower-income group (LIG). The middle-income group (MIG) includes those with a monthly income of Rs 40,000-Rs 70,000, while the higher-income group (HIG) refers to those earning more than Rs 70,000 per month. Government agencies like MHADA, CIDCO construct affordable homes for these people considering their income segment. MHADA defines affordable houses as area having 27.88 carpet area for Economical Weaker Section (EWS), upto 45 carpet area for Lower Income Group (LIG) and upto 80 carpet area for Middle Income Group.


Affordable housing scenario
The development of affordable housing in India is very weak and the situation in Mumbai is more critical. As per the government the shortage housing all over India is nearly 18.78 million as per estimates of 2012. 95 percent of the shortage is in EWS/LIG category. It is estimated 19 million families either living in slums or in low income neighborhoods on rent and this housing deficit is likely to rise to 38 million by 2030.  Now-a-days there are very few affordable housing projects going on in Mumbai. People seeking for affordable homes have to either go to outskirts of Mumbai like Kalyan, Thane District and Navi Mumbai or they chose some other city.
Nilesh Vyas works at a travel Agency in Bhuleshwar, his wife works as a Cook in homes, leaves in Borivali on rental. But now they will have to leave their rental accommodation as their agreement is finishing and they will now they searching a home to purchase, but cannot afford home in Mumbai, they are thinking of shifting to Kalyan or nearby areas. Their family income is Rs. 17, 000, they fall in LIG category “We don’t want to leave this location as my wife works as Cook in nearby homes, but we don’t have any option, as homes in Borivali are out of our reach.” He said.


It is not that only people earning less are not able to come across such situations people falling in HIG category are also not able to discover budget homes at their desired locations. Mehul Shah a Software Engineer was searching a home in Mumbai between Bandra to Borivali could not find a home of his choice and can fit his pocket. He did not wish to leave in city outskirts, so he choose to leave in Pune the new IT hub and emerging realty city.


People like Nilesh or Mehul do not qualify as poor but come under the LIG segment and HIG segment, but still cannot live in Mumbai. However many in Mumbai have resorted to living in slums owing to proximity to the city. The only other alternative they have is to live far away from their places of work and commute for several hours daily by a local train or leave in some other city.


The reason behind scarcity of, affordable housing is that real estate market rather than focusing more on meeting the basic requirements of housing seemed to be concern on providing luxury where a swimming pool, a fancy car parking area and other such facilities are used to attract buyers. What about buyers who cannot afford luxury?


What government is planning?
Recently, Venkaiah Naidu held a meeting addressing a high level consultation meeting with the officers of Ministry of HUPA and Urban Development and other stake holder organisations like National Housing Bank, Indian Banker’s Association, FICCI, ASSOCHAM, CII, and representatives of CREDAI, in New Delhi, said  that the Government is committed to the goal of ‘Housing for all by 2022’. Ministry of HUPA made a presentation which introduced the concept of Housing for All by 2022, Scope of the task, Estimation of resources required, Possible strategy, Proposed organisational structure and flagged the Issues for further discussion.
Mrs. Anita Agnihotri, Secretary, Ministry of HUPA emphasized that infrastructure status for the affordable housing sector may be taken up with the Ministry of Finance and a policy for rental housing may be laid out since there are over 10 percent houses that are lying vacant because of rental policy issues.


What real estate people think?
Anuj Puri, Chairman & Country Head JLL India, says, “The new government has announced a very clear mandate in terms of housing for all, and will therefore need to come up with a detailed affordable housing policy. Such a policy will have to focus on increasing the supply of genuinely affordable homes in the budget bracket of Rs. 20-25 lakh.”


Ram Raheja, Director, S Raheja Realty, sharing his views, said, “Affordable luxury projects to gain more momentum post Modi Govt. The real estate sector is now looking at the new government with the hope of change and growth in their eyes. The projects falling under the affordable luxury segment are expected to benefit the most.”


Mahindra Lifespace Developers Limited, the real estate recently launched its new business vertical focused on making quality housing at affordable prices the project name is Happinest. Commenting on their initiative Anita Arjundas, M D & CEO, Mahindra Lifespace Developers Ltd. said, “India is urbanizing fast and more than a third of urban Indians cannot afford to buy their own homes.  Happinest stands for our intent to enable a cross section of Indians fulfill their dreams of home ownership in a safe, secure and healthy environment.”

It is very clear that to provide affordable housing government and private developers should come together and build affordable homes. Public Private Partnership and CSR is required in real estate sector to fulfill the scarcity and requirements.

Source: Accommodation Times dated July 5, 2014