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Homes no bigger than a bus - Indian Express Mobile
Yeh kamra toh shuru hone se pehle hi khatam ho gaya, bhai!” This piece of wit from the sidekick ‘Circuit
’, of Bollywood blockbuster ‘Munnabhai MBBS’ fame, is being played out in the affordable housing sector today, where real estate developers are offering homes that measure a mere 250 square feet. “Which is, as big as a bus!” said a real-estate expert who did not want to be named. Affordable, but how liveable?
In order to make the dwelling more affordable, reducing the saleable area is one of the several measures that are being adopted by real-estate developers who have entered the market in the National Capital Region, Mumbai, Ahmedabad, Kolkata, Pune, Bangalore and Chennai.
As a result, affordable houses have shrunk by at least 40 per cent of the sizes that existed a decade ago, say real-estate experts.
“According to our estimates, the sizes of affordable houses in Gujarat has shrunk by at least 40 per cent in the last decade,” says Nirav Kothary, head of industrial real-estate division at Jones Lang LaSalle (JLL), a global property consultant.
A recent report titled ‘Affordable Housing in India’ from JLL clearly states, “In order to reduce costs and improve affordability for the buyer, developers have adopted several measures. This includes units having reduced saleable areas of 250-350 square feet for one room-kitchen, and 400-500 square feet for one bedroom-hall-kitchen formats.” Experts describe these homes as being no bigger than a state transport bus operating in the state.
Real-estate developers say that the rising cost of land in urban centres is the main cause behind the shrinkage in the sizes of affordable houses. While experts believe that smaller housing units are an apt answer for India’s housing problems, a research study conducted by the Hyderabad-based Indian School of Business (ISB) in 2011, points out that families feel “uncomfortable” to live in houses that are smaller than 700 square feet.
Even large affordable housing players like Tata Housing are offering units as small as 293 square feet (carpet area) and in Ahmedabad it costs Rs 8 lakh.
In the period 2009-12, affordable housing projects priced between Rs 5-10 lakh have been sold on an “application model” due to huge demand, with multiple takers for the same unit, says JLL.
Thriving market, new suburbs
Increasing land prices have also pushed affordable housing projects away from city centres. Mumbai and NCR have affordable housing projects located 65-75 km away from the city centre. On the other hand, Ahmedabad and Kolkata provide better proximity, with projects located at a distance of 15-20 kms. Bangalore, Pune and Chennai also have projects after a distance of 25-30 km from the city centre, states the JLL report.
The shortage of land has been exacerbated artificially by poorly conceived central, state and municipal regulations. As a result, land prices in India are much higher than intrinsic levels that can support mass real-estate developments.
Mumbai is currently leading the affordable housing sector, with over 15 projects. Karjat, Palghar and Boisar in the neighbouring Thane and Raigad districts are the popular locations for homes at that price point. In Ahmedabad, the localities of Narol and Vatva have multiple ongoing projects.
Apart from Tata Housing the other players are Value Budget Housing Corporation, Foliage, DBS Affordable Homes and Nirman Group. Other big players such as HDIL and Usha Breco Realty have been successful while Mahindra Lifespaces, TVS Housing and S Raheja have announced future developments targeting this segment are.
“There cannot be houses as small as 250 square feet,” says Umang Thakkar, CMD Dharmadev Infrastructure which is currently building 10,000 affordable housing apartments in various areas of Ahmedabad and start at 600 square feet.
Thakkar who has been in the affordable housing business for the last 20 years feels that rising prices of land and the changing lifestyles of people have caused houses to shrink. “The prices of land have risen several fold over the last few years. Moreover, people no longer live in joint families. There are more number of singles and migrants who prefer smaller houses,” says Thakkar.
In order to ensure low construction cost, the building structure is typically low-rise with Ground+ four floors, without a lift. “The low-rise structure and adoption of technologies such as aluminium formwork and building information modelling enables developers to complete the project within a short period of 18-24 months, thus decreasing the collective time and better returns,” the JLL report states.
THE AFFORDABILITY GAME
To make the housing project more affordable for the buyer, developers are adopting the following measures:
Limited options: Units offered are mostly one room-kitchen and one-bedroom-hall-kitchen formats
Reduced areas: Units have reduced saleable areas of 250-350 square feet for one-room-kitchen and 400-500 square feet for one-bedroom-hall-kitchen.
Low construction cost: Structure is typically low-rise with ground+3 or ground+4 floors, without lift.
Shorter period of construction: The low-rise structure and adoption of technologies such as aluminium formwork and building information modelling enables developers to compete the project within a short period of 18-24 months, thus decreasing the collection time and improve returns.
