No takers for ‘affordable’ housing

No takers for ‘affordable’ housing
The Times of India, December 03, 2009, Page 2

Rumu Banerjee I TNN

New Delhi: It was touted as a realization of the ultimate middle class dream — houses that fit the pocket. Just that it went bust. Months after developers flooded the market with housing projects tagged as ‘‘affordable’’, there seem to be very few takers. The reason: the actual area of many of these flats is far less than usual. Others are being rejected because of poor location.

Said Renu Chaddha (name changed), who had bought a flat in an affordable housing project that was launched in Faridabad earlier this year, and is looking for another property to invest in. ‘‘At that time, only a few developers had launched their projects. All of them had good locations, so my husband and I decided to invest. It was only around Rs 20 lakh.’’ Six months down the line, Chaddha says that the newlylaunched housing projects have left her without any inclination to buy.

‘‘The usual room specifications are 1200-1400 sq.ft. for a two bedroom flat. But most of the projects coming out now and being marketed as affordable housing measure between 800-1,000 sq.ft,’’ admitted Pradeep Mishra of Sainik Estates, a local brokering firm.

The affordable tag, according to Mishra, has been added to a number of projects coming out in the past few months. But most have been finding it difficult to find buyers. Smaller rooms for a price of Rs 25-30 lakh have not obviously got buyers excited. Mishra added that many projects have also suffered from the fact that prices were not really reasonable despite being called so.

‘‘Many are over Rs 25 lakh, which is not seen to be in the affordable range,’’ said Mishra. Builders have also brought down costs by cutting on additional charges like car parking, club, preferential location charges etc. by almost 50%.

On the other hand, projects with better specification which are actually selling in the less than Rs 25 lakh price bracket are usually hampered by poor location, say market experts. Said Satya Prakash, an executive with an international realty consultants, ‘‘Many developers are launching such projects in Gurgaon’s sector 91, 92 or 95 or in the inner sectors of Sohna Road. Other localities include the extended Golf course road in Noida or Faridabad sectors that are not near the Delhi border. All these areas are not seen as investment-friendly.’’

Ironically, till even six months ago, the affordable housing schemes were being hailed as a dream come true for a realty market that had been reeling from recession. In the past few months though, barely 30-40% of the new projects have had buyers, said Mishra.