Houses for all – can it become a reality?
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Rise in construction costs and rental values are the major roadblocks, writes M. Soundariya Preetha
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Photo: S. Siva Saravanan
Long way to go: The new residential projects may not meet demand from all sections of society. –
The economic growth of the region has propelled a huge demand for housing in this region and in the last two years, many residential projects have been announced to meet this need of the city.
Along with the new projects, the city has also seen an increase in rental values, and the level of vacancy is minimum.
Rental value
Within the city, the residential rental value starts at Rs. 6 a sq ft and goes up to Rs. 30 a sq ft., varying with the location and facilities provided and age of the building.
The rise in job opportunities in the manufacturing industry here, both engineering and textiles; new large-scale projects in these sectors and the resultant parallel economy have all brought in more people to the city and its suburbs.
Demand
And, this has led to the demand for more houses, the basic infrastructure facility.
The rise in the construction costs and thus in the prices of new houses and rental values has created a vacuum for housing to the income group of Rs. 10,000 to Rs. 15,000 a family.
Says G. Srinivasan, president of the Builders’ Association of India, Coimbatore centre: “Given the current projection of employment opportunities here when the major information technology sector projects also take off, rentals will only go up in the future.”
Supply gap
About the supply gap in housing to this segment, Mr. Srinivasan points out that the spiralling prices of essential construction materials such as cement and steel reflects on the overall pricing.
For a quality building, the actual construction cost starts at Rs. 900 to Rs. 1,000 a sq ft.
Land costs
Added to this are the increasing interest rates and land costs.
Thus, on an average, a two bedroom house in an apartment is priced at approximately Rs. 25 lakh or Rs. 30 lakh.
Similarly, the monthly rental value for a 1,000 sq ft house is Rs. 5,000 or Rs. 6,000.
Quality housing
It can be lower in the outskirts of the city. In order to provide quality housing to all sections of society, the Government will have to step in, he says.
In Mumbai, several housing projects have come up in public-private partnership mode.
Construction materials
Only the Government can make land available at relatively lower prices, Mr. Srinivasan says.
Further, immediate steps are needed to reduce the cost of construction materials.
The demand for housing will continue to go up.
While the city grows it is imperative that the development accommodates all sections of society.
Township projects
“We can also look at township projects spread over huge areas, such as 1,000 acres, in the fringe areas of the city.”
These will have other infrastructure too – such as underground sewage, roads and streetlights.
Infrastructure
In any part of the city, apart from providing housing, it is necessary to ensure that these areas have proper roads, streetlights and other basic infrastructure.
Only with Government assistance can quality housing be made available at affordable prices to all sections of the society, he adds.
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