Affordable property in
India may have received a new champion in the form of the CREDAI. The
confederation of Real Estate Developers Association of India has stated that
banks, as well as housing finance companies, should support builders in the
country when such builders undertake the construction of affordable housing in
India. The reason that the CREDAI has sought the help of banks and other
lending institutions is that the CREDAI feels that affordable projects are a
low margin business which requires cheap capital to earn to profit for
builders.
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Interested in Building Affordable Homes
The government announced in the budget that affordable homes shall
now be counted among infrastructure projects; meaning that builders in India
would be able to take loans at lower rates if and when they decide to build
affordable projects.
Views Recently Expressed
The president of the CREDAI’s NCR chapter has stated that due to
the increase in interest in affordable housing and for builders to meet the
target of affordable housing for all by 2022, builders shall require greater
assistance and help from banks and other lending organisations to make it
profitable to build and sell affordable houses. In other words, the CREDAI’s
believes that due to low profitability margins attached to the sale of
affordable housing, CREDAI requires special facilities from partners such as
lenders and financing institutions to fund the construction of affordable real estate in India.
It has been remarked on Indian
real estate websites that great attention today is focused on an
affordable realestate in India. To make possible the dream of
housing for all within 5 or 6 years will requires a mammoth construction of
houses, firstly, however, building and selling affordable housing at a profit
will only be given impetus when it is thought feasible by builders and
developers.
The NCR Chair of the CREDAI Chapter has stated that developers
will comply completely with the definition of what is an affordable property
and what property does not fall in the affordable segment. Hence according to
some property
sites in India, builders will not classify mid-income or other
higher end projects as affordable projects in an attempt to receive funds at
rates that are more favourable such projects.
Conclusion
A white paper by a leading real estate consultancy has remarked
that many propertiesin
India may be built by capital from institutional investors.
Financing of many properties in India
shall shift from its current informal source to more a formal and transparent
source.
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