India’s Affordable Housing Sector Gaining Momentum
India’s private property developers have started to see a new opportunity to develop housing sector in India. This is mainly due to a variety of factors and these have contributed towards this growth— on the side of supply, the entry of various real estate developers and availability of financial options; whereas rapid urbanization, growing trend of nuclear families and rising income levels have fuelled the demand for affordable housing. There is hardly a dispute that there still is a considerable supply shortage in this segment. India’s urban housing shortage accounts for 18.78 million for the next fiveyear plan from 2012-2017. In Ahmedabad, at least 2.2 million new houses are required to fulfil the demand in the coming 4-5 years. Sun Builders Group as home builders have always believed in offering to its customers, homes that are high on ‘value’ and low on ‘budget’, thus delivering everything they are searching for and more.
As a concept, affordable housing is not a new one. It is at least a decade old, with the local builders and developers of big cities being the original pioneers with their lower income group flats. While the prospect for affordable homes never got really diminished, large real estate companies focussed almost exclusively on premium and luxury projects between 2004 and 2008 as the economy expanded rapidly and banks and financial institutions adopted a more liberal approach to lending out loans.
From 2008, however, with the overall changes in the economy and the real estate market, companies, even large ones, have turned to low-cost housing projects with a renewed focus. Large scale real estate firms have launched low-cost homes at various locations in the price bracket of Rs.10 lakh to Rs.30 lakh and investments in the affordable housing sector are moving north. Gujarat, Bangalore and Madhya Pradesh are among the states that have seen traction in affordable housing.
Today most big names are entering rural housing with built-in risk pricing so as to make it a viable business model. Big names in the industry are rushing into the sector to cater to the existing demand supply gap. More and more projects are being promoted across India. Tier II and III cities have seen a higher rate of adoption for these projects. Low-income customers are happy with their new homes, improved living conditions, safe neighbourhoods and enhanced overall social status, which are some of the benefits that the segment has been able to provide.
The concept of affordable housing as gone down well with consumers, developers and financiers which has given way to end-to-end servicing of this segment, thus becoming a lucrative proposition for one and all. Sun Optima and Sun Real Homes, are residential apartments that are built on this concept and delivers a modern lifestyle experience but without burrowing a hole in your pocket. Affordable housing is the “sunshine” sector for the next five years from a developer and lender perspective. To put it simply, this will be the growth engine of the future for all stakeholders.