Affordable housing: Sector may get infra tag if Realty Bill gets passed

Affordable housing might stand a chance to get the much-sought-after infrastructure tag provided the Union government passes the Bill to regulate the realty sector.

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The institutional mechanism for updating the ‘Harmonised list of infrastructure sub-sectors’ has held that special treatment could be given to affordable housing as a “carve out in housing sector” but regulation of the sector is a pre-requisite. This would require the government to pass the Real Estate (Regulation and Development) Bill, 2013, that could not be tabled in the recent monsoon session.

A panel headed by the secretary of the Department of Economic Affairs constitutes the institutional mechanism for updating the master list of infrastructure sub sectors. Other members include representatives from the Reserve Bank of India, Sebi and Irda. The panel took up the matter following a case made by the Ministry of Housing and Urban Poverty Alleviation for inclusion of affordable housing in the list.

Source - TOI 

New home purchase sentiment strongest in 4 years: ZyFin Research

NEW DELHI: Consumer sentiment about buying a new home is currently the strongest in four years, according to ZyFin Research's New Home Purchase Sentiment Index.

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The research firm says that declining borrowing costs, improving employment outlook and higher availability of affordable housing projects are encouraging prospective home buyers to purchase a new home in 2015.

"Regulatory changes like recent Cabinet approval to the Real Estate Bill (Regulation and Development) are expected to boost home buyers' sentiment further," it said.

According to respondents, mostly middle-class urban Indian consumers, who were polled by ZyFin Research, buying a home is gradually becoming more conducive compared to a year back. "A large section of consumers polled felt they expect borrowing costs to decline further making it easier to avail home loans," ZyFin Research said.

Capturing the improvement in sentiment, ZyFin Research's New Home Purchase Sentiment Index, stood at its highest level since inception in October 2011 in June 2015 at 43.9 in June 2015. It was at 30.7 in June 2014. The index is based on a monthly poll of 3,000 consumers in 11 cities of different sizes across India.

"Boosting aggregate demand remains the key to help an economy out of a slowdown. The recent steps taken by lending agencies to curtail lending rates taking a cue from RBI's interest rate outlook would go a long way in convincing consumers to start opening their purse strings and help generate demand for new homes. Protection of consumer interests, promotion of fair play in real estate transactions and ensuring timely execution of projects have been some of the long pending demands of Indian home buyers," said Debopam Chaudhuri, chief economist at ZyFin Research.

In June 2015, the index level was the highest in South India at 48.9 while West India had the lowest level of 40.5. Among cities, Hyderabad had the highest index level of 74.3 while Ahmedabad ranked the lowest with an index level of 11.1.

Source : ET

Cabinet approves 'Housing For All by 2022' scheme

New Delhi: The union cabinet on Wednesday approved the launch of 'Housing for All by 2022' programme, aimed at rehabilitation of slum dwellers and promotion of affordable housing for the economically weaker sections (EWS) through credit-linked subsidy.

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According to an official statement issued here, a central grant of Rs.1 lakh per house, on an average, would be available under the slum rehabilitation programme.

It said a state government would have flexibility in deploying this slum rehabilitation grant to any slum rehabilitation project taken for development using land as a resource for providing houses to slum dwellers.

"Under the credit-linked interest subsidy component, interest subsidy of 6.5 percent on housing loans availed up to a tenure of 15 years will be provided to economic weaker sections/lower income group (EWS/LIG) categories, wherein the subsidy pay-out on net present value (NPV) basis would be about Rs.2.3 lakh per house for both categories," the statement said.

It said the central assistance at the rate of Rs.1.5 lakh per house for the EWS category will be provided under the affordable housing in partnership and beneficiary-led individual house construction or enhancement.

State governments or their parastatals like housing boards can take up projects of affordable housing to avail the central government grant, it added.

Addressing a press conference after the cabinet meeting, Telecom Minister Ravi Shankar Prasad  said housing for all would a centrally-sponsored scheme.

"The scheme will be implemented as a centrally-sponsored scheme except the credit linked subsidy component, which will be implemented as a central sector scheme," he said.

"The mission also prescribes certain mandatory reforms for easing up the urban land market for housing, to make adequate urban land available for affordable housing.

"Houses constructed under the mission would be allotted in the name of the female head of the households or in the joint name of the male head of the household and his wife," he added.

The scheme will cover the entire urban area consisting of 4,041 statutory towns with initial focus on 500 class I cities and it will be implemented in three phases as follows - Phase-I (April 2015 - March 2017) to cover 100 cities to be selected from states/UTs as per their willingness; Phase - IIA (April 2017 - March 2019) to cover additional 200 cities and Phase-III (April 2019 - March 2022) to cover all other remaining cities.

The dimension of the task at present is estimated at two crore houses.The exact number of houses, though, would depend on the demand survey for which all states/cities would undertake detailed demand assessment for assessing actual demand by integrating Aadhar number, Jan Dhan Yojana account numbers or any such identification of intended beneficiaries.

A technology sub-mission under the scheme would also be set up to facilitate adoption of modern, innovative and green technologies and building material for faster and quality construction of houses.

The technology sub-mission would also facilitate preparation and adoption of layout designs and building plans suitable for various geo-climatic zones.

Source : India Today

Gujarat govt to adopt 'redevelopment policy' for affordable housing in state

Ahmedabad: The Gujarat government is all set to announce a 'redevelopment policy' to initiate building of affordable houses in place of old colonies, a senior official said in Ahmedabad on Monday.

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The plan is to build 1 lakh affordable houses in cities like Ahmedabad, Rajkot, Vadodara and Surat, Urban Development and Urban Housing (UDD) Secretary Mona Khandhar said.

According to her, the policy is ready and will be announced "very soon".

"We have already prepared the final policy draft and it will be announced very soon. This is the first time in Gujarat where a redevelopment policy will be launched," she said.

The policy primarily aims to build new houses in place of old and dilapidated houses built around 15 to 25 years ago in major cities, by the Gujarat Housing Board (GHB), which is the state's nodal agency for construction of affordable houses.

"We want to provide new and improved houses to those living in houses which show signs of aging and are in a dilapidated condition. Apart from being bigger in size, these new houses would also have several amenities like better parking space," she said, adding these new houses would be built on the same land on which old housing colonies stand.

"The biggest benefit to occupants is that they will get bigger houses. Our aim is to build 1 lakh new houses in five years. These 1 lakh houses also include many old houses which will be replaced with new ones," she said.

"In addition, we will be able to add new apartments by constructing multistoreyed buildings on the same land where buildings with very less floors were built earlier. Through this initiative, optimal use of available land would be achieved," she said.

Since the policy's focus is on building new houses in place of existing ones in urban centres, the state government has made provisions to incentivise occupants of these houses, who may have to bear some financial burden to get new homes.

"Our aim is not profit, but to provide better homes. Though current house owners may have to shell out some money to get new homes in place of old ones, we will definitely incentivise them to make sure that they don't feel too much financial burden," she said.

Giving more insights into the policy, a senior GHB official said that lack of maintenance over the years have left many houses in a dilapidated condition.

"So far, GHB has built around 1.76 lakh houses in the state. Most of them are more than 15 years to 25 years old now. Moreover, the carpet area of these houses are also small because of then prevalent Floor Space Index (FSI) limitations," the official said.

"This low FSI forced us to build low-rise buildings back then due to which the majority of these colonies have three to four floors only. Now we aim for optimal utilisation of land by building multistoryed buildings" the official said.

He said that when these colonies were built several years ago, land prices were not high. Presently, land prices are as high as Rs 1 lakh per square yard in posh areas, where many old colonies are situated.

"FSI limitations have been eased, paving the way to build some more floors. Thus, we can build multistoryed buildings in the same place, which will give us extra number of apartments at no extra cost. Simultaneously, present occupants will get bigger homes with better amenities," the official said.

He said that it is likely that private builders would be roped in under the Public Private Partnership (PPP) model along the lines of the Gujarat government's affordable housing policy launched in 2014.

"Our aim is to build houses without incurring extra cost. We will invite private builders and developers to join this mission under the PPP model. We will give them a specific quota of houses which they can sell in the open market," Khandar said.

Source : Times Of India

Developers, analysts look forward to implementation of Land Pooling Policy in Delhi

NEW DELHI: Affordable housing in the capital city of Delhi could get a major boost with the centre notifying norms for the land pooling policy, a decision welcomed by the industry. 

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The decision can bring down the land prices in Delhi and solve housing problems for the economically weaker sections. 

 

The Centre, on Tuesday, notified the operational guidelines for putting to use the Land Pooling Policy of the Delhi Development Authority (DDA). The policy itself was notified a year and a half back. 

 

"Delhi may be able to unlock its potential for real estate development across 20,000 hectares of land concentrated across peripheral zones," Anshuman Magazine, chairman and managing director, CBRE South Asia said. 

 

However, since most of the land falling under this policy is in remote and peripheral areas of Delhi, infrastructure development in these areas will take time and immediate housing solution may not be possible. 

 

"This policy will make available more land for housing, bringing down land price prevailing in Delhi," said RK Arora, chairman of Supertech. 

 

"This likely to result in a healthy availability of residential dwelling units which will not only enable availability but also help in keeping a control on residential prices," said Rohan Sharma, associate director-research and real estate intelligence service, JLL India. 

 

Developers like Prateek Group are looking forward to the implementation of the policy. "As developers we would be eagerly waiting for the policy to turn out the way it is planned. The effects on Delhi's realty will be very clearly visible once this activity starts," said Prashant Tiwari, chairman, Prateek Group. 

 

Now the Delhi government has to notify 95 villages, mostly in southwest, west and north Delhi, as development areas. The government has to declare 89 of these villages as urbanised. 

 

The DDA had proposed the policy to have private sector participation in land consolidation and development while DDA itself assumed a larger role of a facilitator. 

 

According to the policy, those who provide DDA with larger land parcels will benefit more. On contributing 2-20 hectares, the land owners will be compensated with land parcels measuring 48% of the original. Those contributing 20 hectares or more, the compensatory plots will be 60% of the original plot. The owners will be allowed to build residential, commercial, public and semi-public facilities on these alternative plots.

Source : The Economic Times (ETRealty.com)

Maharashtra may cut stamp duty on residential properties to push affordable housing

MUMBAI: Home buyers in Mumbai and the rest of Maharashtra are set to receive a major relief as the state government is planning to reduce the stamp duty on residential properties spread over less than 750 sq ft for the economically weaker, lower income and middle income groups.

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The stamp duty rates will be rationalised with 1% levy for houses for economically weaker section (EWS), 2% for low income group (LIG) houses, and 3% of the agreement value for middle income group (MIG) houses. Buyers of higher income group (HIG) apartments will continue to pay stamp duty at current rates.

 

At present, home buyers pay 5% stamp duty on ready reckoner rates -government specified rates -or market rate, whichever is higher. In a far-reaching measure, the policy has also proposed that the stamp duty will be calculated for these segments on the basis of market value at which the transaction is concluded as mentioned in the agreement.

 

The state government's draft housing policy , that has proposed these changes, has defined EWS houses as residences spread over up to 269 sq ft, LIG houses spread over 270 to 538 sq ft, MIG houses as 539 to 753 sq ft, while any house spread over more than this area is defined as HIG. Registration charges for these houses will also be lowered to the standard Rs 1,000 per transaction against the current levy of Rs 25,000.

 

All of these proposed measures are aimed at making housing units, which are less than 750 sq ft, relatively affordable by reducing the stamp duty burden for home buyers.

 

"Home buyers stand to gain on two counts as the stamp duty rate is being reduced and the base will also be lower for these levies. In most of the high-value pockets of Mumbai and other cities, ready reckoner rates have already moved above the market value and therefore stamp duty on market rate will be effectively lower," said Manish Kumar, managing director of Strategic Consulting at JLL India.

 

Ready reckoner rates are revised every year based on weighted average of transactions concluded in the year gone by . Earlier this year, the state government had raised these rates by over 30% in most pockets of Mumbai.

 

Following this increase, ready reckoner rates had moved above market values prevailing in many localities. While the average increase across the city is between 15 and 20% this year, the highest rise stands at about 40%.For 2014 and 2013, the state government had raised the ready reckoner rates by an average 13%.

 

Areas such as Worli, suburbs, including Goregaon, Borivali, Malad, Chembur, Ghatkopar and Vikhroli, have seen rates go up by as much as 30-40%, and were among the most affected areas.

Source : The Economic Times (ETRealty.com)

Greater Mohali Area Development Authority launches new housing scheme

MOHALI: This year Greater Mohali Area Development Authority (Gmada) has commenced a new reasonably priced housing scheme for the year 2015-16, at Mohali.

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This is Gmada's second biggest residential project under the land-pooling scheme. The total budget is planned to be around Rs 3,400 crore, which will also include development work in the town which has been decided worth Rs 1,800 crore.

 

The authorities had already acquired 220 acres in sectors 90 and 91 and where they have planned to construct around 800 residential plots and there are two housing projects coming up in Sectors 66 and 70.

 

A K Sinha, chief administrator, GMADA, said, "We have new scheme to be launched in Sector 88 and also allotment of new plots or flats at Eco City under phase II are the two major residential projects scheduled to be completed in 2015-16."

 

Eight and 10 marla plots would be available in sectors 90 and 91 which comes under the second project under the land-pooling scheme.

 

The Gmada had already acquired land measuring 600 acres in Sectors 88 and 89 under the land polling project. Two BHK and 3BHK flats in sectors 66 and 70 were also on the cards.

 

"The Gmada understands that property rates are slashing but they not going to be permanent, and there are people who are approaching private builders to have their own house or flats and we are offering the same and that too in much more affordable price," said Sinha.

 Source : The Economic Times (ETRealty.com)