PM Modi’s ‘Housing for All’ a wishful thinking for the industry? Read on to know why!

The Cabinet Committee of Economic Affairs (CCEA) approved Prime Minister Narendra Modi’s ambitious project of ‘Housing for All’ scheme last week but real estate industry experts are not expecting much out of this project. Simply because the biggest requisite of this project i.e. land is not adequately available.

This leads to a simple question—what happens to the urban poor? The land inadequacy is a major problem in the urban areas and hence, providing shelters for them could become a major challenge for the government.

“While the slum-dwellers will be provided livable shelters at no cost under this scheme, likely through public-private partnership slum rehabilitation project, the scheme does not offer tangible solutions for the urban poor who is not residing in a slum and wants to own a house in a metro city. Though the loan amounts have been increased, his income levels may not qualify him for the loan disbursal amount that is high enough for him to buy a house in the current scenario, when housing prices are high,” said Anuj Puri, chairman of JLL India.

Substantiating his point, Puri explained that to create housing for the urban poor, the government must unlock the land in the urban areas. “Needless to say, this will require massive efforts to recognise and delineate the non-essential lands currently being held by large government bodies such as Indian Railways, Ministry of Public Enterprises, Port Trusts and Department of Heavy Industries. Unlocking such lands while speeding up the approval process and creating incentives for private sector participation are all needed as part of a large, coordinated effort if we are to realise the vision of Housing for All by 2022,” he noted.

Apart from the availability of land, industry players noted that not much has changed in terms of policy and processes.

According to Puri, “There is a need for systemic change in how the government perceives the entire issue of housing for the urban poor. Regulatory changes, faster approvals, removal of red tape and resolution of land litigation issues need to be adequately addressed to improve stakeholder participation. While the consent clause for the affordable housing segment has been done away with in an ordinance, the government is still struggling to get it passed through parliament.”

A three-pronged strategy which involves the state, regulatory bodies and the private player, for achieving the target has been suggested by the industry. Both the Central and state governments need to have their own housing policies in synergy with each other.

“Execution penalties will be deterrents, but it is essential to have the right development partners who will not put their hands up in the middle of project execution citing financial viability. Suitable fiscal incentives to the private industry as well as financial support through cheaper industry loans will also be required to ensure healthy participation,” he noted.