The ‘Housing for All by 2022’ initiative by the Government of India has been revolutionary for the country’s real estate sector. The last few years have seen an upsurge of high-quality affordable housing projects that are attracting the interest of all kinds of investors and homebuyers.
The Growing Need For Affordable Housing In India
There is an estimated shortage of 4 crore houses in India across the rural and urban areas. Additionally, the steady population growth (at 1.3% per annum), the continuous migration of labour to the cities and the rise in the income and aspirations of families will increase the demand by another 1 crore houses per year.
As a result of the migration influx into cities, the demand for housing in the affordable segment has surged. There is a huge gap between the demand and supply of affordable housing options in India, and the government is taking all kinds of measures to bridge it.
The Demand For Affordable Housing
Over the last few years, there has been an increase in the mass population’s affordability to buy a house, especially in the urban areas. While the incomes have risen, the property prices have remained more or less the same. The mortgage rates have also gone down, further fuelling the demand for affordable housing.
The Advantages Offered By The Affordable Housing Sector
Real estate developers are being incentivized in many ways to focus their efforts on the affordable housing sector. Affordable housing is the only segment of the real estate sector that allows the developers a 100% tax exemption. At the same time, there are also tax exemptions on unsold inventory and certain relaxations on failure to deliver the project within a stipulated time period.
The Future Of Affordable Housing: A Paradigm Shift
Affordable housing holds the potential to propel the Indian economy in several ways. It offers the scope of generating capital investment measuring up to Rs 1-1.25 lakh crore per annum incrementally. At the same time, it holds the promise of creating 27-34 million jobs and contributing in significant ways to the GDP.
The affordable housing sector plays a key role in India’s growth story. As a vital sector of the economy, it provides employment and housing, addressing two of India’s greatest challenges in the present day.
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