Rishabh Siroya, Director, Legend Siroya Realtors

The mention of affordable housing in Mumbai appears a dream and a very improbable one to come true. The city of Mumbai is undoubtedly one of the most expensive cities in the country and also the face of urbane Indian lifestyle. It is the country’s fashion and business capital and a cosmopolitan hub of modern India. Mumbai is a city that attracts thousands of people to its soil everyday thus creating a strong demand for quality living accommodations. The presence of profitable business opportunities and professional jobs has led people into shifting base to the city and at the same time look for affordable means of accommodation arrangements.

Over the years, there have been several initiatives to provide low cost housing in Mumbai after periodic demands have been on the rise. Where realty prices are skyrocketing, that home you have always wanted to own is perhaps getting more and more elusive.

The common man wants a decent space to live in – one that accommodates his family, is easily accessible and equipped with a few basic amenities. Mumbai’s realty market has been snubbing him off for some time now. Rising interest rates, inflation and escalating commodity prices have taken a toll on the country’s biggest real estate market. Affordable housing has remained a distant dream. For a metropolis like Mumbai that is teeming with people, the concept of affordable housing becomes all the more imperative.

The big question, though, is does affordable housing really exist in Mumbai?

The government has put the figure for the housing shortage in urban India at a staggering 26.53 million units in the Eleventh Five Year Plan 2007-2012. In Mumbai, developers battle high land prices, input costs, labour and construction material costs. Add to that a lack of space and the fact that the developer cannot compromise on quality and we have realty imbroglio.

What is affordability really?

It is actually affordability towards a product as well as the source to buy that product. For instance, buying a home today is not just about raising the funds for it. It is also about bank loans, rate of interest, fuel prices, cost of daily grocery, children’s education, other loans etc. The problem is that buyers cannot postpone buying a house indefinitely. They end up buying despite tight purse strings because they have to.

So then, does it mean that affordable housing isn’t possible in Mumbai at all?

Of course it is. Perhaps, we might have to go a little beyond the prime areas of the city – locations that are feasible and are not too inaccessible either and within MMR. Studies have shown that some of the key aspects of affordable housing in India are location of the project, property specifications, amenities provided, price identified and finally the size of the project.

The central suburbs of the city like Chembur, Powai, Ambernath are a viable option. These suburbs are great locations for creating mass housing – a term better suited than affordable housing. A clutch of new builders across the country has come up with low cost projects with houses costing below Rs.20 lakhs in this stretch. The Maharashtra Chamber of Housing Industry (MCHI) has also embarked on an ambitious plan of facilitating the creation of five lakh affordable houses by 2015.

But we need more. To make affordable housing a success in India, the government needs to incentivise developers through cheaper land, awarding higher FSI, infrastructure development, easier home loans and interest rate subsidies to motivate them to participate actively and aggressively in this segment. Also, there needs to be a single window clearance to acquire necessary permissions, because inevitably a developer is stuck in a labyrinth of approvals that hinders the completion of the project. Affordable or mass housing is the need of the hour in the city and can be certainly converted into a reality. All it needs is the will from all the stakeholders including the developer, government and most importantly the buyers.