Pradhan Mantri Awas Yojana (PMAY) to financially aid approx. 35% to 40% for affordable houses – recognized as a basic amenity to own.
Tamil Nadu: According to a recent analytic report by Anarock Property Consultant, economically feasible houses are in demand by the lower and creamy layers of democracy. It is estimated to grow further, all credits to better financial structure introduced in recent times.
The new enhanced financial structure on affordable houses by the government promises 39 – 40 percent higher allocation, relatively to 2016-2017 sanctioned under PMAY (Pradhan Mantri Awas Yojana). New enhancements promise extensions of credit linked subsidy to loans up to 12 lakh INR, and a guaranteed infrastructure status to this sector. This radiates as a good and reliable financial asset, resulting in a cash-flow segment for many budding builders to invest for a start – said A. R. Singh, CEO Anarock Property Consultant.
The Central Ministry has been constantly been making progress by helping this sector from the last three budgets. The first budget, in its experimental phase seemed more incubated with least expectations while the succeeding two made significant progress in the economy. The vision to make housing available to a ‘common man’ – a reality will significantly rise in the coming decade. Government Real Estate Policy Act with the new principles and directives on Development and Regulation have instilled faith and confidence in potential buyers to invest more without much hustle in the market, he added.
Anuj Puri, Chairman of Anarock recalled the year 2008 where affordable housing sector was chosen as the last resort to escape sub-prime lending crisis; And now, investors are keen to invest in this sector, all thanks to the transparency introduced by the housing and infrastructure committee. Affordable housing is a long term dream set on a fast track with the right ingredients to aid its progress. Markets improved in 2009 and many investors dropped this new-found instant growth quickly whereas, some builders held on to explore more. Some prominent investors such as Provident, Arun Exello, Ashiana Housing among others chose to believe in it a little more, he further said.
Developers and builders choose to stay in the affordable housing segment due to 100% income tax break and recognition gained as a the infrastructure status. We took it up many sites and invested in bulk when we started off in 2010. Today around 80% of the apartments sold in around the country are in this segment. Government has been there for us so far and we hope to further venture with them independently without any quarterly support, said P. Suresh, MD of Arun Excello who currently sells up to 1000 to 1500 units a year.Domestic agencies such as ICRA had predicted that this segment would witness more than 30% growth in medium term and be the driving force of the financial market for Indian Mortgage.
One needs a basic knowledge on market evolution and institutional advancements to experience a significant growth in economic housing. This is a volume game and one needs to know how Standardization works. An understanding of the conveyer-belt model is required. Affordable housing segment should be monotonized with the new work culture suited to the environment of the project, said Anuj Puri, Chairman, Anarock, further lending a constructive opinion on the subject.