Mumbai: Realtors have sought to bring up incentives like free land allocation and public-private partnerships models to increase affordable housing stocks for the economically weaker sections.
"There is a huge shortage of housing for the poor sections of the society. To meet rising demand for affordable housing, active government participation is needed which could be by way of offering incentives to developers," said property consultant DTZ Chief Executive Anshul Jain.
According to an expert committee report submitted to the Union Housing and Urban Poverty Alleviation Ministry recently, more than 18 million housing units are required in the 12th Plan.
The report had also noted that as much as 88 per cent of this shortage pertained to houses for the poor and another 11 per cent for low income groups.
"To provide a house at Rs 1,000-1,200 per sq ft at a time when the cost of land and construction is too high, is not a viable proposition. This deters developers from taking up affordable housing projects," he said.
Peninsula Land Vice-Chairman and Managing Director Rajeev Piramal said providing low-cost housing becomes uneconomical especially when the other costs are going up.
"With land contributing nearly 20 per cent to the overall construction cost, it actually becomes uneconomical for creating affordable housing. Creating such homes at high cost puts pressures on our margins. At the end of the day, we are into business and we want to make profit," Piramal said.
He further said if the government can provide certain incentives to developers for creating affordable homes, many realtors will come forward.
"Since land cost is high, we would expect the government to provide us land free of cost, which we can use exclusively for creating low-cost housing stock. Such incentives can encourage developers to undertake projects for providing affordable homes," he said.