BJP Rajya Sabha MP Piyush Goyal’s promise that his party would create 200 million jobs in 10 years if it comes to power with absolute majority at the Centre should not be viewed in isolation. Close on the heels of Goyal’s assertion — which focuses on creating 100 million affordable houses to create 15 million jobs every year — at the National Council of the Confederation of Indian Industry meet in New Delhi on February 17, comes another development. The Maharashtra government’s proposal to set up the housing regulatory authority by June to bring in transparency in real estate to empower buyers. As if on cue, India’s Housing Development Finance Corp has raised Rs300 million to invest in affordable housing, upto Rs30 lakh with a cap of 60 sq mts.

At a time when India’s GDP for 2014-2015 is expected to grow at 5.6 per cent, perhaps bringing an end to a bleak phase of less than five per cent growth in the current fiscal, the thrust on low-cost housing is in keeping with global interest in real estate in emerging markets. A PwC report corroborates this trend. It says that investment in real estate in developing economies in the Asia-Pacific region, including India, is likely to rise by 140 per cent to USD 10.2 trillion by 2020 — a whopping rise from USD 4.3 trillion in 2012.

The reasons are not far to seek. With metros reaching a saturation point and the high-end segment failing to yield commensurate returns, tier 2 and 3 cities are increasingly finding favour with big builders. Gujarat, Karnataka, and Madhya Pradesh have emerged as the front-runners, while the industrial belt in the Delhi-NCR region is now being seen as a potential market. Kolkata and Bhubaneswar too are gradually gaining traction.  

Interestingly, in spite of its tremendous growth potential, LIG housing till recently wasn’t considered lucrative by builders. Sample this: In the last five years till 2013 only 80,000 homes in the Rs3-10 lakh range had come up in the country.

In Mumbai, the SRA scheme, providing higher FSI to builders hasn’t elicited an enthusiastic response. The checks and balances built into the scheme, in the interests of slum-dwellers, have proved to be a deterrent for builders. Seeking permissions from several stakeholders, including 70 per cent of home owners, the land owners, the Slum Rehabilitation Authority, the Coastal Regulation Zone authorities in the state and at the Centre, the urban development authority, and finally the BMC — if the project falls within city limits — have contributed to unnecessary delays.

Mumbai — where space is forever at a premium — is a  developers’ market.  The sector is mostly in the news for corrupt practices. Chief Minister Chavan’s efforts to clean up the system, though late in the day, are most likely to bring down prohibitively high prices, the highest in the country.

The other move by the CM, extending the cut-off date for slum regularisation to January 1, 2000, should be a shot in the arm for low-cost housing in the country’s financial hub, provided the government opts for a single-window clearance. Not just Maharashtra, the rest of the country, too, stands to benefit if such a system is implemented nationwide. At a time when the Centre is eyeing FDI in real estate, red-tapism will only serve to hinder India’s growth prospects.

Source And Courtsey By:- http://www.dnaindia.com/analysis/editorial-dna-edit-housing-for-the-poor-1966357