In the three years of the new government, the talk in the real estate sector has been about affordability and affordable housing. The new schemes launched under the aegis of the Modi government have been touted as the saviour of the dreams of owning a house for the Lower Income Group (LIG). One however, needs to take a step back and look at the term affordability itself, as in the case of the real estate sector in India, affordability can really mean different things for different groups. Do residential flats in Gurgaon have the same affordability as residential flats in the outskirts of Delhi? The answer is obvious. This article then explores the different meanings the term holds for different groups of demographics, and the socio-economic variables that guide the meaning, in different locations.
For a long time, the LIGs has been paid little attention, often only sending welfare schemes their way seemed to be the right-enough policy. Recently, there has been a change; these groups, which form the base of the Indian economy, and which also, are the dominant demographic in India have received the chunk of the affordable housing schemes. For instance, the lack of better public transport network meant that the city’s peripheries while they gave good affordable housing options were still out of question because of their inaccessibility. The logic is simple – better connectivity makes affordable housing a residential destination. Keeping this picture in mind, let us try to understand what makes affordable housing an important variable in the economic growth of a city and eventually the country.
Apart from the individual ambition of home ownership, the working class in any city need to be retained within the city preventing the outward movement of valuable skills, talents, and contribution to the local economy. A large demographic of India is composed of educated, working class, which is always in the search of better opportunities and when finds one, prefers to move in that direction. With this in mind, the Housing and Urban Poverty Alleviation Ministry revised the criteria to define the economically weaker section in India. According to this revision, households which have an income up to INR 1 Lakh fall under the EWS. Earlier, this category had an annual income range between INR 5,000 – INR 60,000. More importantly, according to the new definition of Lower Income Groups, households with an annual income of INR 1-2 Lakhs fall under the revised criterion. Both these groups need financial security and a good lifestyle, in order to choose a city, and home ownership allows for exactly that.
The next section of the population is the middle class – a group which is economically sound but may still be sensitive to high prices and finding it difficult to afford within the city. This group then expands the definition of affordability and makes it wider as much as it is localised. Although homebuyers from the middle class would have enough budget to afford a good property in the far outskirts, they face tremendous challenges in, for example in buying a house closer to the location of their employment, their children’s educational institutions or near to the conveniences that the rich would not have to worry about.
In the present scenario, there is an acute shortage of good affordable housing options within the city especially for buyers who fall within the INR 35-50 Lakhs range, even when there are houses available for INR 20 Lakhs just outside the city. This section, however is not interested in moving far away still, from the lifestyle and the conveniences that they have worked so hard to afford. Within the range of the city limits, such as affordable housing in Gurgaon, becomes almost a myth for the middle class.
As a profitable business in the real estate sector, affordable housing has a good absorption. But as long as affordability is not reinterpreted both at a locality as well as at the level of the city, we cannot celebrate the cause of the affordable homes.
Signature Global is a reputed name in the real estate sector in India dealing in affordable housing projects. Signature Global’s residential flats in Gurgaon include their massive projects of Solera (Sector 107), Synera (Sector 81, NH8) Andour Heights (Sector 71), Orchard Avenue (Sector 93), Grand Iva (Sector 103), Roselia (Sector 95A), Serenas (Sector 36), Solera (Sector 107) and The Millennia (Sector 37D). At present, Signature Global’s Signum project offers retail shops in Gurugram in sector 36, 95A, 93, 103, 71, 81, and 107. For bookings.
I'm a real estate writer at Signature Global. My passion is helping people to provide all aspects of real estate marketing flows through in the expert industry coverage. In addition, I also work as an SEO Analyst at Signature Global helping businesses with search and content marketing. http://www.signatureglobal.in