35 PRIVATE INSTITUTIONS SUPPORTING HOUSING IN INDIA

P.G. Padma Gowri

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PRIVATE INSTITUTIONS SUPPORTING HOUSING IN INDIA Introduction:

 

Housing recognized as a basic need, governments at every level are discussing ways and means to provide access to housing for their citizenry. Housing is where resting to sleep. The quantity, quality, availability and affordability of housing becomes a key component in national economic competitiveness The role and function of housing is multifaceted — housing choices impact access to infrastructure, employment, household wealth, health, education, poverty levels, maternal and child mortality, women’s participation in workforce, and many other wellbeing indicators. As India seeks to improve its living conditions on a large scale, access to affordable housing with low cost building materials are a major stumbling block for its citizens.

 

Objectives:

  • To understand the concepts of private housing in India
  • To know about Confederation of Real Estate Developers’ Associations of India
  • To identify Low cost affordable housing projects and Building with Indigenous Materials

Affordable Housing in India:

 

Affordable housing refers to any housing that meets some form of affordability criterion, which could be income level of the family, size of the dwelling unit or affordability in terms of ratio of house price to annual income

 

The Ministry of Housing and Urban Poverty Alleviation (MoHUPA) in its 2011 report takes note of both income and size criteria to define the

 

·         EWS: Economically weaker sections;

·         LIG: low income group;

·         MIG: middle income group.

Three main reasons for private sector contribution to Affordable housing in India:

 

In India, the problem is much more stark with an estimated shortage of around 18 million houses, with 99% of this in the economically weaker sections of society  Second, along with the growth of the urban population, rising incomes have led to the expansion of the middle class. This has led to a spike in demand for housing that is “affordable” but includes basic amenities.

 

Third, the real estate sector is a major component of the Indian economy.

 

  •   It is estimated that the real estate sector contributed to 6.3% of the GDP in 2013— 14,
  •   It is estimated 3.7 lakh crores and employed about 7.6 million people (CREDAI, 2013).
  • So housing is the largest component of the financial as well as the construction sector

 

Private sector players in affordable housing:

 

Affordable housing has traditionally been the purview of the state: it is only recently that the private sector has entered into building houses for the lower-middle and middle-class segments. Several factors propelled this development. Easier availability of land in the suburban areas along with infrastructural connectivity, availability of facilitating and financing agencies such as the National Housing Bank, international developmental organizations, international NGOs, micro finance institutions and private equity players, economies of scale and first mover advantages have also propelled this interest.

 

In the year 2009 onwards, real estate developers have launched projects across Indian cities in locations which are away from the core central business/secondary business districts where land prices are affordable.

The more prominent developers include

 

·         Tata Housing (Shubh Gnha),

·         VBHC, Foliage, DBS Affordable Home, Nirman Group,

·         HDIL, TVS Housing, S.Raheja, Mahindra Life spaces and

·         Usha Breco Realty (Monitor Deloitte, 2013).

 

Project features:

  • The projects are located 20—25 km from the city centre, cover 15—35 acres and have 1500—3500 units.
  • These projects have limited options, closeness to industrial or commercial hubs, reduced area, low construction cost, shorter period of construction and provision of basic social amenities.
  •  The pre-tax internal rate of returns (lRRs) in a low cost housing project can range from 40 to 45 percent with gross profit margins of 15—20 percent, which is slightly reduced compared to the 30—40 percent margins available in high-end real estate projects.

For example:Tata Housing is planning to add 8-10 projects to its portfolio in 2017-18 involving an investment of up to Rs 800 crore, they will be a combination of green field and brown field projects.

 

International Finance Corporation (IFC)

 

India’s green building initiative and International Finance Corporation (IFC) is planning to invest over USD one billion in next five years .IFC, a member of World Bank, has planned an investment of around USD 5-6 billion for the next five years in India for participating in the country climate change programs .

 

IFC ties up with 5 developers, 2 financial institutions to form Sustainable Housing Leadership Consortium ( SHLC).

 

With an aim to achieve nearly 20 per cent of countries new housing developments to be green by 2022, IFC has joined hands with five developers and two financial institutions to form Sustainable Housing Leadership Consortium (SHLC). A first-of-its-kind, voluntary, private sector-led initiative, SHLC is working towards mainstreaming green homes in India and aims at least 20 per cent of Indias new housing developments to be green by 2022 .

 

IFC along with the founding members of the consortium include leading real-estate developers Godrej Properties, Mahindra Life space Developers, Shapoorji Pallonji Real Estate, Tata Housing Development Company and VBHC Value Homes and joined by the financial institutions HDFC and PNB Housing Finance Corporation.

 

The aim of the consortium members is make 100 per cent of their new housing portfolio green, thereby contributing 110 million square feet of green housing by 2020.

 

SHLC also has the support and participation of the Ministry of Housing and Urban Affairs (MHUA). SHLC will also work with institutions like TERI to understand green technologies, which developers can adopt to make their projects green.

 

Confederation of Real Estate Developers’ Associations of India (CREDAI)

 

Confederation of Real Estate Developers’ Associations of India (CREDAI) was established in 1999 with a mandate to pursue the cause of housing and habit providers. On the advocacy side, CREDAI is today the preferred platform for National discourse on Housing and Habitat.

 

CREDAI is a recognized partner for the government and is represented on committees working at policy formulation, including the Housing and Habitat Policy 2007, the Steering Committee for Urban Developing, Housing and Poverty Alleviation for the 11th five-year plan, various committees of the Bureau of Indian Standards (BIS), Bureau of Energy Efficiency (BEE), Planning Commission and others.

 

CREDAI has also worked incessantly to make industry more organized and progressive. it is mandatory for all the member developers of CREDAI to maintain integrity & transparency in the profession of Real Estate Development.

  CREDAI is a knowledge sharing network about the latest industry data, technology advancements and industry benhmarks for its members.

 

CREDAI is taking a major step to fill gaps in housing data. Housing statistics worldwide are amongst the most important real ticme indicators of health of the economy. Real Estate Sector is a critical sector of the Indian economy, contributing around 10% of the total GDP of the country.

 

CREDAI’s CSR initiatives have given credence to the fact that real estate is a socially responsible community which has demonstrably carried out large amount of social and charitable efforts in the area of building Schools, Hospitals, Skill Development, Education, Places of Worship, Old Age Homes, Care Centers, Child Centers, Roads and Gardens.

 

CREDAI has inscribed the critical importance of real estate to the GDP of India on the minds of the government, policy makers and general public and has become the backbone of the Real Estate Industry

 

CREDAI Green Buildings Initiative:

 

The Indian Green Building Council (IGBC) and the Confederation of Real Estate Developers’ Associations of India (CREDAI), have entered into a MOU incorporating among others, following areas of cooperation-Confederation of Real Estate Developers’ Associations of India (CREDAI) have partnered with IFC (International Finance Corporation), a member of the World Bank Group to promote green buildings in the country through EDGE certification. EDGE is poised to jumpstart the mainstreaming of green buildings across the country in a fast, simple and affordable way.

 

CREDAI encourages its members, including local chapters, to incorporate resource efficiency in their design using EDGE. To qualify for the certification, these efficiencies must result in savings of at least 20 percent in energy, water, and materials over the local standard practices. IFC will train members and share global best practices and knowledge with CREDAI on green building technologies.

 

Centre government initiation for affordable housing Mission “Housing for All by 2022”

 

“Housing for All by 2022” aimed for urban areas with following components/options to States/Union Territories and cities:-

 

a)   Slum rehabilitation of Slum Dwellers with participation of private developers using land as a resource;

b)  Promotion of affordable housing for weaker section through credit linked subsidy;

c)  Affordable housing in partnership with Public & Private sectors and

d)  Subsidy for beneficiary-led individual house construction or enhancement.

 

A Technology Sub-mission under the Mission would be set up to facilitate adoption of modern, innovative and green technologies and building material for faster and quality construction of houses. The Technology Sub-Mission will also facilitate preparation and adoption of layout designs and building plans suitable for various geo-climatic zones. It will also assist States/Cities in deploying disaster resistant and environment friendly technologies.

 

The Technology Sub-Mission will also work on the following aspects: i) Design & Planning

 

ii)     Innovative technologies & materials iii) Green buildings using natural resources and iv) Earthquake and other disaster resistant technologies and designs.

 

In the spirit of cooperative federalism, the Mission will provide flexibility to States for choosing best options amongst four verticals of the Mission to meet the demand of housing in their states.

 

Low cost affordable housing projects.

 

To implement low cost affordable housing projects the following activities are important.

  •  Achieve economies of scale by adoption of innovative construction techniques
  • Adequate efforts are made in achieving economies of scale, construction costs can’t be minimized in case of public as well as private affordable housing development.
  • Design standardization coupled with use of low cost technologies and bulk material procurement strategies can immensely benefit affordable housing projects.
  •  Standardize building norms to promote design standardization
  •  Low-cost construction technologies
  •  By leveraging on innovative and low-cost technologies, such as pre-fabrication, developers can construct affordable houses quickly and cost–effectively.
  • Although, pre-fab materials are 15-20 percent34 costlier, developers would gain from the dual benefits of higher efficiency and lower labor cost.

Building with Indigenous Materials

 

Homes built from indigenous materials are unique dwellings, not cookie cutter productions. They are individual representations of a region, climate, and culture. At the same time they have the potential to be comfortable, functional, durable, and energy efficient and to satisfy modern standards of living. They can make use of common materials that people formerly considered scrap or waste, or didn’t think of as building materials at all.

 

Millions of people worldwide live in houses made from minimally processed local construction materials such as earth, straw, and native wood. Indigenous materials are those native to a building site or its surrounding region, and indigenous methods are the particular applications of those materials, as developed to suit a specific climate and culture. Indigenous materials are generally relatively expensive, due to their abundance and the minimal costs incurred in transporting them to the building site.

 

The use of indigenous building methods has the potential to cause less air. water and land pollution than the use of industrially processed building materials. Some applications of earth, mineral, and agricultural waste involve little additional processing energy. If local sources are used, transportation energy and resulting pollution are kept to a minimum. Many indigenous building materials are minimally processed and do not contain chemical additives such as adhesives. This promotes good indoor air quality and safe and easy disposal of the building materials at the end of a building’s lifetime. Use of low cost building materials for construction of low cost housing increases the access to buildings by low income group peoples. Low cost housing can be achieved by use of efficient planning and project management, low cost materials, economical construction technologies and use of alternate construction methods available.

 

Use of Natural Low Cost Building Materials:

 

The total energy required to produce a material is called embodied energy. The greater a material’s embodied energy; it requires a greater usage of non-renewable sources. It is therefore advantageous to use materials or composite materials prepared from the wastages.

 

The natural materials such as stones, wood, lime, sand and bamboo can be used in ample wherever possible. The natural materials impact more sustainability to structures as well as they are friendlier to environment. Some of the environment friendly building material technologies used in India are,

 

Using Energy Efficient Building Materials

 

Energy efficiently of a building material can be measured through various factors as its R value, shading coefficient, luminous efficiency or fuel efficiency. Energy efficient materials must reduce the amount of generated energy.

 

Composites of Low Cost Building Materials

 

The composite building materials are made of composition of two or more materials which have enhanced property. Natural fiber materials are coming up as excellent substitutes for the prevailing building materials. Fibers like jute, sisal coconut, ramie, banana are cheap and environmentally suited as they are made from natural fibers. They are also replacing the fiber reinforced plastics.

 

Composite building materials present immense opportunities to replace traditional materials as timber, steel, aluminum and concrete in buildings. They help in reduction of corrosion and their low weight has been proved useful in many low stress applications. Each type of composite has its own characteristic properties and thus useful for specific purpose.

 

Jute fiber reinforced polypropylene composites, coir fiber reinforced composites, sisal fiber jute produced composites. CBRI has developed MDF composite doors containing coir fiber, cashew nut, shell liquid (CNSL) as natural resin and Para formaldehyde as major constituents.

 

Pultrusion is most cost effective method for producing composite profiles. It is commercially applicable for light weight corrosion free structures, electrical non conductive systems and so many other functions. The pultruded items are recognized and recommended in the Global markets. Pultruded sections are well established alternative to steel, wood and aluminum in developed countries and catching fast in other parts of the world.

 

Many composite building materials are generated from glass fibers and industrial wastes. These materials are used for manufacturing of portable toilets, water storage tanks, outdoor furniture, bathtubs, interior decoration, basin, door, and window frames etc.

 

Conclusions:

 

Social upliftment could be achieved through affordable housing only when the required infrastructural linkages are provided by State Governments. Parallel development of physical infrastructure like road, drainage, transport, water supply, sewerage disposal, electricity etc and social infrastructure like schools, hospitals and commercial centers etc. are critical for the success of such projects. Using the composite building materials in construction vary from cladding to internal furnishings and the owner highly benefits due to their application because of their light weight, resistance to corrosion and availability in different colors. The mission of India “housing for all by 2022”achieved by using emerging construction technologies for development of affordable housing

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