Affordable Will Be The Choice Of Housing In 2021
Pradeep Aggarwal, Chairman, National Council on Affordable Housing, ASSOCHAM
Despite the lower-than-normal sales traffic in the real estate sector, the affordable segment has emerged as the hot cake for the wannabe homebuyers. Post-Unlock, the segment witnessed improvement in the number of visits to the site, and the properties sold immediately first because of the pent-up demand and realisation of people to own their home, the boost in sales got further boost when home loan interest rates came down to around 7 per cent. Looking at the response to affordable projects in the post-pandemic months and with some developers getting over-subscription in their projects, the year 2021 is going to be phenomenal for this segment.
The affordable housing segment survived the onslaught merely because it caters to the price bracket that has maximum demand. Several factors worked in favour of affordable housing, including Rs 3.74-lakh crore liquidity infusion announced by the RBI on March 27, 2020, the CLSS extension announced in May, relief under EPF, etc. The biggest takeaway for the buyers, however, was the unprecedented cut in the repo rates, which resulted in home loan interests coming down to sub-7%. The tragedy also came as a blessing in disguise for the sector, especially the affordable housing segment, as the middle class was facing challenges in staying at rented accommodations. We have launched 19,200 units so far and intend launching 10,000 units by March 2021. As many as 5000 units are under the Haryana affordable housing policy, and another 5000 are under the Deen Dayal Jan Awas Yojana. We would be in a position to launch all 30,000 units by 2021.”
The turnaround after the COVID can be attributed to the fact that affordable housing is being promoted at war front with adequate support being extended to developers showing interest in this segment. To attract private participation, the government rolled out special incentives such as use permission, 50% additional FAR/FSI, concessional loans at priority sector lending rates and tax reliefs at par with affordable housing to develop ARHCs on their own available vacant land for 25 years.