India being a populous and developing country has become a manufacturing hub for most of the world. This has led to housing crisis growing at a rapid pace. The labor class people working in these factories earning below Rs.10000 are unable to find proper living arrangements within their budget. Shortage of space can also be seen in tier II and tier III cities especially with manufacturing hubs.
The sector for budget homes is highly unorganized as many do the construction for their houses on their own at higher costs and even private players in the real estate industry are hesitant in undertaking such projects because of uncertainty in terms of profits, loans and even government support.
The cost occurred for construction of budget homes that can be 200-300 sq.ft. in size with one room and kitchen can be around Rs.6-8 lakhs in a tier II city and even lower in smaller cities as cost of land is less than that of a tier II city. But due to improper planning and various bureaucratic processes this cost goes up to Rs.10 lakhs for a single unit. An average factory worker needs around 15-20 years of hard-earned saving to start construction of a house in this way. To top the high cost there is no loan available for the same and people who need money have to search for alternate ways such as personal loans, loan sharks, etc. The complete construction for the house can even take more than 1 year to finish.
For reasons such as this much of the Indian population in these cities live in rented accommodations where even the rent takes up a good part of their earnings.
The affordable housing initiative by the government does not completely cover these types of properties. So there needs to be an initiative that can even be in form of social entrepreneurship to take up projects such as this, which in the long run can also be profitable and solve problems faced by the people in our cumulative society. The private players such as Godrej Properties, Lodha Group, Piramal Realty, etc. can even take such projects as part of their CSR initiative if conditions are made favorable.
Alternatively, to reduce further costs new methods of construction which uses precast & prefabricated materials that is cheap, durable and also requires less time can be used. Among them is the method created by IIT Madras students to construct a low cost, eco-friendly houses within a month using pre-fabricated GFRG (Glass Fiber Reinforced Gypsum) panels made from waste gypsum.
Further arrangements for covering these properties under housing loans should be considered as well so that it can benefit the people who wish to buy these budget houses.
The need for housing is equivalent to the need for food. It isn’t a luxury but a necessity that a lot of people are struggling to achieve. Budget homes work towards fulfilling this necessity and providing people a place they can call ‘home’. This can be the initiative that will help to ensure the Indian government’s target to provide housing for all.
Shanur Shaikh || PGP MR
shanur.shaikh@northpointinda.com