Govt should give infra push and let market forces create affordable housing
In the past one year, when most markets were struggling to sell property, two suburban hubs of Mumbai - Thane and Navi Mumbai was clocking brisk enquiries and even better sales. The reason was clearly consumer driven demand. Egging that demand on was a slew of infratsructure projects such as the Eastern Freeway that reduced travel time from Navi Mumbai to Central and Southern Mumbai, the much awaited East-West connectivity through the Metro link and the Shifting commercial hub to suburban Thane.
These few moves made distant suburbs an affordable coice for thousands of average Mumbaikars who could not buy what met their pocet and also travel to work in either their own suburb or even think of driving down to work in the city everyday.
However, here I would like to reccomend one more role for the government - whenever there is a project that fits the sub-Rs 50 lakh bill per housing unit, fast-track approvals and ensure that the project does indeed meet timelines. There is no harm in regulating the industry to the extent that delays in this segment are not condoned and there is a Bg Brother watching to see that those projects that are begun with end user money are completed and handed over in time and to promised specification. That would bring consumers back in droves.
I have long questioned whether the Indian consumer was getting hold of the wrong end of the stick when they mindlessly invested in residential real estate for long-term gains. I think the future of real estate will be end users buying houses to stay in and structured investment funds purchasing large numbers of units to lease out. Already there is a generation of consumers who are extremely mobile between cities who are quite happy living in leased accommodation. By the time they have invested in a house and it is completed, they are ready to move to the next city in search of better jobs. They want well-maintained, lifestyle rich apartments that are reasonably priced for lease and preferably furnished too.
Do these urban nomads want affordable housing? Certainly. But it should be affordable for stay today and not affordable to buy today for ownership tomorrow. This is why in today's market you will see a large number of buyers scouting for bargains on ready-built property. In may markets like Hyderabad, which has seen the jobs market showing signs of revival, property markets inching up slowly. if the house is ready and there is no ris of either construction of house or transport links, consumers will move in tomorrow.
Urban India is today looking for affordable houses but on their terms. If the houses are in distant suburbs with poor or no connectivity and far from job markets, develoeprs can market them till the cows come home. The consumers are not going to bite.
Housing is a lifestyle choice for the buyer, it would be good if developers and governments understand that and build housing and infrastructure in tandem. Can onsite lifestyles be matched with offsite travel links?
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