The state government has stepped in to broker peace between unrelenting builders and anxious buyers, planning a series of measures to make houses affordable.
The new plans could include full stamp duty waiver for smaller houses as in the case of Andhra Pradesh, tax concessions and subsidies, relief on interest rates and simplification of procedures.
The government will announce within a fortnight its action plan, declaring 2009 as the Housing-For-All Year.
“The economic slowdown has hit the real estate sector hard. There are no buyers in the luxury segment. The only way out is to create more housing stock for the lower segments where the demand is maximum,” said state housing secretary Sitaram Kunte.
The plan will be prepared by the Maharashtra Housing and Area Development Authority, along with the Private Developers’ Association and the Maharashtra Chamber of Housing Industry (MCHI), Kunte said. “We will be working on policy reforms and a calendar of events,” he said.
The MCHI has suggested that developers could build smaller homes, as also removal of Value Added Tax on property and concession in stamp duty and development charges paid to the BMC. “We have also suggested that the government give incentives such as a higher FSI of 3 to developers building affordable homes,” said MCHI vice-president Sunil Mantri. He said the Chief Minister has approved all the suggestions in principle.
Developers like Runwal, Akruti and Lodha group recently reworked their focus on the high income segment and launched “affordable housing” projects. But, as Homebay Residential — a wholly owned subsidiary of Jones Lang LaSalle Meghraj — pointed out, not a single such project is within the limits of Greater Mumbai.
According to Homebay Residential CEO Raminder Grover, affordable housing in the areas outside Greater Mumbai in the Mumbai Metropolitan Region would be defined as homes in the range of Rs 20 to 35 lakh. “In Mumbai itself, affordable housing would cost around Rs 40 lakh. However, since land comes at a premium in Mumbai, as of today there is no affordable housing project in Mumbai,” said Grover. He predicts that in the next three months, a lot more developers will get into affordable housing sector to increase their sales and cash flow, though all of these would continue to be in areas like Thane, Virar, Navi Mumbai and Kalyan.
(via Express India.)
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