Affordable housing was the buzz word in the real estate sector in 2014. A major chunk of demand and supply generated in the sector last year belonged to the affordable housing segment. Some of the major cities of the nation like Delhi, Noida, Gurgaon, Bhiwadi, and Mumbai saw a plethora of high quality affordable housing projects taking birth. It was a dream come true for Lakhs of families who otherwise couldn’t afford a home till now and were residing in a rented abode. All was hunky dory and affordable housing was being seen the segment which will wage a fight back and bring the bleeding real estate sector back on track. But things have taken a U-Turn and definitely not for the better.
The segment has now long been plagued by low margins and high costs. The Union Budget that was tabled on 28th February was expected to provide a much needed breather to the segment and the sector as a whole but failed miserably in doing so. The Narendra Modi led government was expected to provide incentives and iron out the difficulties troubling the sector but the budget proved to be a disappointment.
The sector had communicated a list of its expectations from the budget. They included infrastructure status for affordable housing, approval for introduction of subvention schemes in the affordable housing segment to boost affordability, lower interest rates below 7.5%, tax rebates on raw materials, additional exemption of income tax on home loans, reduction in service tax, reduction in home loans interest rates, crystal clear roadmap for its housing for all by 2022 scheme and many other reasonable insights and observations. But most of the demands were not heeded to in the budget.
If one sees the larger picture the budget is pro growth and is extensively beneficial for the people of India. The benefits of the budget will surely be reaped in the long run by every Indian. But the real estate sector has been downright ignored. Realty experts were expecting and hoping for some industry specific guidelines, boosters and incentives, especially for the affordable housing segment, but nothing significant materialized. Infrastructure status to real estate so that long term funding could be facilitated – was also expected.
As a result the affordable housing segment is expected to take a back seat. The farfetched dream of India’s common man to have a sturdy roof over his head might not come soon anytime soon. Its high time government laid out specific ground rules and built a clear foundation for its affordable housing and housing for all by 2022 schemes. It is very much capable of fulfilling the common man’s dream and must remember that millions of people are counting on them for the same.