NAREDCO seeks incentives for affordable housing

Hyderabad The members of apex real estate body National Real Estate Development Council (NAREDCO) appeal to the Central and State governments to announce more incentives to boost affordable housing as well as reasonable renting of homes across India. They were here to take part in the celebrations of NAREDCO’s 25th Silver Jubilee Foundation Day on Saturday.

Speaking to Bizz Buzz, NAREDCO President Rajan Bandelkar said: “We are requesting the governments to support affordable housing by providing incentives. The term ‘affordable’ is measured based on the cost of the house, but it must be measured by area. We are urging the government to change this view. A 1,000-sq-ft flat may be priced at Rs20 lakh in Patna, Rs80 lakh in Bengaluru and Rs2 crore in Mumbai.”

He also exuded confidence that the real estate and construction industry will contribute significantly in increasing the national GDP if necessary tax sops are given to this sector. “The Central and State government policies will proactively support the growth of the realty sector. With that, the NAREDCO will wholeheartedly drive the affordable housing initiatives across the country,” he added.

Expressing similar views, NAREDCO’s vice-chairman Niranjan Hiranandani said: “Today, there is no scarcity of funds for the development of housing and external infrastructure in the country. Thanks to the international funding agencies like Japan International Cooperation Agency (JICA). Over Rs80,000 crore has been spent in the past six years to deliver 1.1 crore affordable houses by the end of this year.”

“These houses were built under Pradhan Mantri Awas Yojana (PMAY), by both public and private sectors. In the FY23 Budget, around Rs27,000 crore has been allocated for the balance payments under the PMAY scheme. To create ‘housing for all’ in real terms, we are asking the government to offer additional 1.25 crore affordable houses over the next five years,” he informed.

Hiranandani further said, “Along with affordable housing, the governments must also focus on creating an adequate stock of affordable rental housing in the urban areas. Necessary steps shall be taken to create surplus housing for rental accommodation. A comprehensive policy is required to provide initial incentives and tax sops to push affordable renting.”

He also suggested the banks and NBFCs to give attractive interest rates on home loans under the affordable housing segment. The NPA rate is still less than two per cent in home loans. With the interest rate hike from 6.5 per cent to 8.5 per cent over the past few years, the sales of mid and high range houses increased for the first time over low-cost houses.

The real estate and construction sectors play a critical role in fostering the country's growth and reducing unemployment. All stakeholders, including government, private, and public sectors, must work together to achieve the target of zero unemployment and foster exponential growth in the real estate and housing sectors.

According to NAREDCO Vice Chairman, about 37,000 workers were skilled in the housing and construction sector last year under the government’s National Initiative for Promotion of upskilling of Nirman workers (NIPUN) project. However, more than 3.7 crore workers must be upskilled to fulfill the needs of the industry. If this is done, unemployment will vanish from the country.

Stressing on implementing new technologies, Atul Chordia, Chairman of Panchshil Realty and NAREDCO member, said: “Today, the real estate sector needs to keep pace with the latest developments taking place in the country. So many startups have come up with innovative solutions to ease the business. The technological advancements will speed up the construction and enhance the quality of the buildings.”