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The Challenges and Solutions While Buying Affordable Luxury Housing

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Last updated on July 20, 2020

According to the data garnered from several surveys in 2012, there was a demand of around 18.78 million homes, which has risen in the last seven years at a staggering rate. The newly elected government launched affordable housing concept in India, aka ‘Housing for all by 2022’, under Real Estate Regulations Act (RERA), majorly for the economically weaker section, to speed-up the affordable housing for all. Despite all that has been done and introduced as schemes or as such, there is still a big void in the market when it comes to quality housing with comfortable amenities, at required localities, as the luxury real estate yet faces numerous challenges. With this post, here, we will be discussing the challenges and their probable quick solutions.

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The paucity of Land:

The paucity of desired or suitable yet affordable land has surfaced up as a huge challenge in the current property market. While the need for housing well within an affordable budget has gradually yet steeply elevated, so has the requirement of homes which are more than mere four walls of brick and cement, in a nice neighborhood. Now, though several builders and developers have come up with affordable homes yet finding land in urban localities of Delhi, Mumbai, Goa, Bangalore, etc. at affordable rates is something they all are struggling through.

Financial Literacy:

Though there are several finance schemes available for the people, so as they can invest in real estate and own a good house, yet much of the population is still unaware or uneducated about these policies, thus rendering them unable to enjoy the benefits from the same. Also, there are several easy home loan options, interest rate subsidies, and various other financial schemes to exploit in the most beneficial way. As people are generally unaware or are under the wrong impression that all this can create a lot of hassle, tend to avoid buying a luxury villa or a magnificent house they desire and require.

Unclear Policy Framework:

The unclear definitions have resulted in the creation of chaos and misunderstanding even among the builders and developers, rendering them confused about the Housing Schemes. Though one can be assured that these housing schemes will take away the woes of buying a house in the country, yet how these schemes can be utilized is what no one understands. Additionally, somehow these definitions keep changing from state to state, group to group, city to city, it creates more chaos and the ambiguity makes it even harder to think about buying a house. With the current population spur of educated working professionals there is a high demand for luxurious homes with all the amenities, and if they could be provided with a little support in a clearer manner, the real estate sale with spike several times.

High Approval Costs:

Approval Costs have become a huge roadblock for the buyers and builders alike. The higher approval costs in mainland cities cause developers to shift their focus to rural or pre-urban areas where the land is cheaper and approval costs low. Now as the majority of working professionals are in urban cities, that means either they have to spend hours in commute or they are forced to live on rent. With a little support from the government, if the builders are able to procure land in urban cities at better prices, this could quite beneficial to the average buyer.

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Key Solutions to These Challenges
  1. Regularising the taxation system can be a boon for the affordable housing segment
  2. Educating the people about the financing aids and other terms is imperative. Even the builders and developers should assist a potentially interested buyer to understand various benefits they can enjoy with availing several available schemes.
  3. Offering affordable housing to all with reduced interest rates is a step by the government and the segment targeted at affordable housing should be made aware about it
  4. As most affordable housing projects and luxury housing projects are in the periphery of cities, the government needs to improve the connectivity of the cities should be improved
  5. Prior planning and sustainable urbanization can also help in meeting the vision created by the housing mission
  6. Government taxes, charges, fees, etc., levied on the development of any project should be removed from the affordable housing segment to encourage builders and developers to invest in this segment

As the educated population and working professionals in the country are rising, who comes from a diverse financial background and may or may not have a good monetary back up behind them, but they all require a better standard for living. With a little help, they might be able to afford and enjoy their every day in their own homes.

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