Affordable housing offers development opportunity

Following a slew of policy initiatives and regulatory changes in 2017-18, affordable housing offers 6-8 billion sq. ft. development opportunity in India over the next 3-4 years, showed a CARE Ratings report. Affordable housing segment of late is being primarily driven by government policies and incentives. As per Government estimates, over 40 million urban homes need to be constructed by 2022 in order to achieve its housing for all targets. During the last 24 months, the government has introduced schemes for affordable housing like interest subsidy for low and economically weaker sections, affordable housing being conferred infrastructure status to ease fund availability for these projects and additional tax-benefit for both developers and home-buyers. Residential real estate sector has started witnessing some revival as more of affordable housing inventory has started hitting the market during the second half of 2017-18. According to the rating agency, the performances of listed companies- NIFTY Realty constituents in particular, indicate possible improvement in demand and more importantly, sales in real estate sector. Fewer launches post demonetization and implementation of RERA led to lower inventory addition while sales overtook the number of units added during the year. The same has been a steady trend in the past 2-3 years where the sales numbers have been higher than the number of units added, the report said.