Affordable Housing: Policy Measures
Content
Affordable Housing: Policy
Measures
http://www.realkonnect.in
Affordable housing is one of the objectives of
authorities’ policy measures taken from time to time.
The phrase 'affordable housing' connotes homes that
are affordable for the section of the society whose
income is below the median household income.
Affordable housing implies differently across
countries. This is because of the policy and polity
scheme in the country. Affordable housing in India
refers to the scheme aimed to close benefit the lower
middle income groups. In an emerging country like
India, affordable housing plays a significant role. In
such countries, people cannot afford to buy homes at
prevailing market price.
Role of affordable housing
According to Census 2011, 31.2 % of the
population lived in urban areas as against
27.8 % in 2001. Urbanization ahead is likely
to be faster and urban population is likely to
spurt to 40 % of the population in the
country. In this scenario, affordable housing
is significant in ensuring hosing for.
How affordability criterion is determined
Disposable income is an important criterion
in determining affordability. It’s
government’s responsibility to ensure that
the policy favours the intended beneficiaries.
The government’s measures such as helping
real estate developers to go for publicprivate partnerships (PPP) to execute
affordable housing projects are
commendable. In this article, we’ll discuss
the policy measures in Union Budget 2016.
Policy measures
The authorities have declared to ensure
universal housing by 2022. The measures
declared are intended to benefit both
developers as well as home buyers.
For developers, tax has been exempt for
small size housing (home measuring 30 sq
metres in metropolitan cities and 60 sq
metres in cities other than metros). The
intended homes have to be completed
within a period not more than three years.
Developers will have to pay the MAT
(minimum alternate tax). Research shows
that the measures would make developers
profitable.
Government's measures are likely to
encourage developers focusing high-end
housing (Rs 50 lakh and more) would take
attention to more affordable versions of
housing.
For first time home buyers who borrow up
to Rs 35 lakh stand to benefit because of a
deduction Rs 50,000 on interest payable on
the loan. For optimal targeting, the value has
been fixed at Rs 50 lakh, for which this
exemption will apply.
There is no prefixed official price that could
be tagged to affordable homes in India.
There is no concrete rule for this in India.
However, by convention, three factors are
considered when defining affordability,
namely the monthly income of the buyer, the
size of the home and its price. The size
corresponds to 200 - 300 square foot and
price to 7-12 lakh.
A thing of concern is people within income
bracket bigger than industrial working class
cannot afford to buy 300 – 400 sq feet home
within the proximity of 10 to 15 km from
workplace. People in this category looking
for homes can afford to buy homes prices at
30- 40 lakh with the aid of bank loans.
RealKonnect is a real estate portal that
operates in Mumbai. Our objective is to help
our prospects/clients find the dream
property in Mumbai. RealKonnect specialize
in helping home buyers, builders and real
estate consultants to achieve best property
deals in Mumbai.
Measures
http://www.realkonnect.in
Affordable housing is one of the objectives of
authorities’ policy measures taken from time to time.
The phrase 'affordable housing' connotes homes that
are affordable for the section of the society whose
income is below the median household income.
Affordable housing implies differently across
countries. This is because of the policy and polity
scheme in the country. Affordable housing in India
refers to the scheme aimed to close benefit the lower
middle income groups. In an emerging country like
India, affordable housing plays a significant role. In
such countries, people cannot afford to buy homes at
prevailing market price.
Role of affordable housing
According to Census 2011, 31.2 % of the
population lived in urban areas as against
27.8 % in 2001. Urbanization ahead is likely
to be faster and urban population is likely to
spurt to 40 % of the population in the
country. In this scenario, affordable housing
is significant in ensuring hosing for.
How affordability criterion is determined
Disposable income is an important criterion
in determining affordability. It’s
government’s responsibility to ensure that
the policy favours the intended beneficiaries.
The government’s measures such as helping
real estate developers to go for publicprivate partnerships (PPP) to execute
affordable housing projects are
commendable. In this article, we’ll discuss
the policy measures in Union Budget 2016.
Policy measures
The authorities have declared to ensure
universal housing by 2022. The measures
declared are intended to benefit both
developers as well as home buyers.
For developers, tax has been exempt for
small size housing (home measuring 30 sq
metres in metropolitan cities and 60 sq
metres in cities other than metros). The
intended homes have to be completed
within a period not more than three years.
Developers will have to pay the MAT
(minimum alternate tax). Research shows
that the measures would make developers
profitable.
Government's measures are likely to
encourage developers focusing high-end
housing (Rs 50 lakh and more) would take
attention to more affordable versions of
housing.
For first time home buyers who borrow up
to Rs 35 lakh stand to benefit because of a
deduction Rs 50,000 on interest payable on
the loan. For optimal targeting, the value has
been fixed at Rs 50 lakh, for which this
exemption will apply.
There is no prefixed official price that could
be tagged to affordable homes in India.
There is no concrete rule for this in India.
However, by convention, three factors are
considered when defining affordability,
namely the monthly income of the buyer, the
size of the home and its price. The size
corresponds to 200 - 300 square foot and
price to 7-12 lakh.
A thing of concern is people within income
bracket bigger than industrial working class
cannot afford to buy 300 – 400 sq feet home
within the proximity of 10 to 15 km from
workplace. People in this category looking
for homes can afford to buy homes prices at
30- 40 lakh with the aid of bank loans.
RealKonnect is a real estate portal that
operates in Mumbai. Our objective is to help
our prospects/clients find the dream
property in Mumbai. RealKonnect specialize
in helping home buyers, builders and real
estate consultants to achieve best property
deals in Mumbai.
