HOUSING AFFORDABILITY

PS – GROUP NO# 10

Names of Team Member

SL NO ROLL NUMBER NAME

1 210301003 Ajay Kumar Roy
2 210301009 Ayan Kumar Jana
3 210301037 Mathur Prabudhkumar Parajkumar
4 210301040 Ananth  Krishnan

Date Of Submission:- 1st November 2021

DO YOU OWN A HOUSE
CONTENTS

 What is Affordable Housing?

 Why do we need for Affordable Housing?

 How can we bridge this affordability gap?

 Where have we reached so far and what’s next?

DEFINITION OF AFFORDABLE HOUSING

“Affordable Housing” varies across

economies, but generally it includes a financial
component (the share of income devoted to
housing), a standard for what constitutes
minimum socially acceptable housing with a
clear idea of what income groups are affected,
and at what income level households should be
eligible for housing assistance.
An affordability index ≈ Measurement of
an average person's ability to purchase house
CRITERIA FOR AFFORDABLE HOUSING
Category Size  EMI / Rent
Minimum of 300 sq ft super built up area
The Ministry of Housing and
EWS
Urban Poverty Minimum of 269 sq ft (25 sq m) carpet area
Alleviation (MoHUPA) in its 2011
report takes note of both income Minimum of 500 sq ft super built up area Not exceeding 30–40%
and size criteria to define the LIG gross monthly income of
concept  Maximum of 517 sq ft (48 sq m) carpet area buyer

600–1200 sq ft super built up area

MIG
Maximum of 861 sq ft (80 sq m) carpet area

EWS: economically weaker sections; LIG: low income group; MIG: middle income group.
 
MYTHS AND REALITIES ABOUT AFFORDABLE HOUSING

 Affordable housing decreases productivity

 Upper income and lower income housing market with a mixture of incomes
 Addressing the affordable housing gap means investing in new building
 Cities can guarantee decent housing by imposing high standards
 There is no land for affordable housing
 Construction costs are too high to make housing more affordable
 Affordable housing is too risky to finance
 Affordable housing is an unattractive investment
 Affordable housing is a national level problem
 Affordable housing require a massive commitment of government resources
CONTENTS

 What is Affordable Housing?

 Why do we need for Affordable Housing?

 How can we bridge this affordability gap?

 Where have we reached so far and what’s next?

GAP TO BE FILLED
ESTIMATED HOUSING REQUIREMENT

Housing Requirement

Cannot Afford
The estimate of the 2025 housing challenge (440 million
24%
households) includes about 200 million existing households in
developing economies and an estimated 32 million
households in advanced economies whose housing is 46% Developing
inadequate, as well as around 100 million households that are
financially stretched. In addition, we include an estimate of
106 million more urban households by 2025 that are likely to
23%
be unable to afford decent housing. Financially Streched
7%
Developed
 INDIA RANKS 54TH GLOBALLY IN HOME PRICE APPRECIATION

Reference- https://www.financialexpress.com/money/india-ranks-54th-globally-in-home-price-appreciation-knight-frank/2329834/
SIGNIFICANT AFFORDABILITY GAP IDENTIFIED IN INDIAN
CITIES
INCREASING DEMAND FOR URBAN HOUSING

 Rapid urbanization fueled by growth opportunities and decline in the role of agriculture.

 Urban Housing Needs:

 Needs of New and Migrant population

 Replacement demand due to wear and tear.

 Changing needs driven by social and economic improvement

 Not a unique problem to India

 Countries face this issue acutely during their economic growth

 Need innovation to take into account local conditions and setup.

CONTENTS

 What is Affordable Housing?

 Why do we need for Affordable Housing?

 How can we bridge this affordability gap?

 Where have we reached so far and what’s next?
AFFORDABLE HOUSING CAN BE ADDRESSED SYSTEMATICALLY

SETTING • Define income and affordability threshold

TARGET
• Set standard unit size and Set target volume and gap to bridge

• Unlock land for Affordable Housing

EMPLOYING • Improve capital productivity
COST
REDUCTION
• Improve energy efficiency and gain scale
LEVERS • Reduce buying cost to buyers
• Assist developer financing

• Community Engagement
STRENGTHENIN
• Funding
G LOCAL • Hybrid Delivery model
DELIVERY
• Local Governance
• Digitize property transaction records
FOUR LEVERS CAN NARROW THE AFFORDABILITY GAP
TAKING AN INDUSTRIAL APPROACH CAN OPTIMIZE COST OF HOUSING
CONTENTS

 What is Affordable Housing?

 Why do we need at is Affordable Housing?

 How can we bridge this affordability gap?

 Where have we reached so far and what’s next?

OVER TIME HOUSING HAS BECOME MORE AFFORDABLE

In 2020, Ahmedabad had the most

affordable housing market of the eight
biggest metropolitan areas in India with a
proportion of 24 percent of income to
monthly instalment of a housing unit. In
Mumbai the affordability index was at 61
percent.

Reference- https://www.statista.com/statistics/1032919/india-house-price-income-ratio/
AFFORDABILITY OF HOUSING HAS SHOWN IMPROVEMENT OVER TIME
BUT STILL A LOT TO COVER

 Efforts are uncoordinated and too small to make an impact

 Large and haphazard urban development
 Land price speculation, aided by corruption, making houses unaffordable
for low and middle income earners
 Large unmet customer demand especially for small and low-priced
houses

 Housing Industry seems “Under-developed” and “over-regulated”

 Policies skewed towards “Home Ownership” as opposed to “seeking

reasonable shelter”
SO TO CONCLUDE…

 Set policy at the city level

 Funding allows function
 Focus on location
 Make employment and socioeconomics integration priorities
 Enable housing for all
 Design an integrated approach
 Encourage efficiencies across the housing value chain
 Empower communities
ANY
QUESTION ???