Affordable Housing a fastest growing segment in India
In India, affordable housing has become the fastest growing segment in realty sector with maximum new launches as well. Three years back, builders were dedicating supply to the premium segment (above ₹50 lakh). Affordable Housing a fastest growing segment in India. Today, with government doling out housing subsidies for the economically weaker sections and increased focus of the developers on the segment, the contribution of affordable houses to total residential sales has gone up to 21 percent from just 8 percent three years ago, as affordable housing cost less than Rs.25 lakh in India.
Affordable Housing a fastest growing segment in India. According to Pankaj Kapoor, founder and MD of Liases Foras, the market has rationalised and a major part of the new supply is directed at the affordable segment. Between the first quarter of 2016 and 2019, when affordable segment almost tripled in sales, the share of luxury homes with a tag of over ₹2 crore went down from 14 percent to just 5 percent. In the June quarter, 10890 homes costing less than ₹25 lakh were sold, year-on-year sales growth of 32 percent.
The incentives given by the government are attracting both buyers and developers to the affordable segment. Under the PM Awas Yojna (PMAY), households with an annual income of up to ₹18 lakh can avail ₹2.3 lakh upfront subsidy for a home. Buyers are also eligible for income tax exemption on housing loans. Moreover, developers get 100 percent deduction for profits in affordable housing project for flats upto 30 sq metres in four metros cities and 60 sq mt in other cities completed in three years.
Rohit Poddar, Managing Director, Poddar Housing and Development, said that there has been a general buoyancy in the market after structural changes like demonetisation and implementation of RERA and GST. Consequently, confidence is coming back. The maximum pent up demand existed in the affordable segment. It is now resulting in transactions after the supply has come into the market.
Poddar Housing focuses on affordable segment and has around 1 crore sq ft of projects being launched in the Mumbai Metropolitan Region and Pune between October and March next. They are mostly in the affordable category. Read more