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India to Witness $1.3 Trillion Housing Boom in 2018-24

The plan aims to construct 20 million homes across the country.The plan aims to construct 20 million homes across the country.

On one hand where India has the world’s most expensive residential house, it is also home to several slums and alarming number of homeless people, on the other. It is this unhoused sector that might trigger the next big change in India’s economic growth.

In June 2015, Prime Minister Narendra Modi had announced his ambitious plan to provide ‘Housing for All’ by 2022, a program which aims to construct 20 million homes across the country. This boost in realty sector will set the stage for investment worth $1.3 trillion in housing sector, CLSA India Pvt Ltd said, Business Insider reported.

The investment banking firm expects that between 2018 and 2024, India would be building 60 million new homes, while also creating about two million jobs annually. These changes would increase the country’s GDP by as much as 75 basis points.

Prior to government’s demonetization move, India’s affordable housing was growing the fastest, but experienced a slump after almost 86% of the nation’s currency was banned on November 9, 2016. However, the industry has started showing signs of recovery.

Modi government has already granted affordable-housing builders an “infrastructure status”, thus making them eligible for state incentives, subsidies, tax benefits and institutional funding.

This, accompanied by a drop in mortgage rates and stable prices in comparison to increase in per-capita incomes, means that the realty sector is readying itself to welcome the next big change in the country’s economy.  

Union Minister of Urban Development, Housing and Urban Poverty Alleviation, Venkaiah Naidu, has confirmed that housing approvals in Delhi and Mumbai will come within 60 days. The notification for the model approval process in Delhi and Mumbai is expected soon.

In an interview with Magicbricks, he said that there will be an online process through which applications will be sent and approvals will come in 60 days. Even in some case, if that approval doesn’t come through, the owner or developer can file an affidavit and start construction. Efforts are on to implement the process across the country.

He also thinks that the whole country needs to follow this and trying to implement this, the center had invited all states for a discussion on these issues on February 28, in Delhi.

Metropolises such as Bengaluru, Pune and Noida are under scrutiny and comprehensive plans are being drawn to build better infrastructure. The center is facilitating creation of funds for urban local bodies in states to make cities more livable.

 

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