While the number of housing units added to the city in 2014 was around 20,000, the actual absorption was much lower
An accident that resulted in the loss of many lives, hike in the cost of construction material, a conservative approach to buying property, and delay in handing over new homes were some of the major occurrences in the construction industry in Chennai, this year.
The collapse of an 11-storey building in Moulivakkam on June 28 shook not just Chennai, but the housing sector in the entire country, leading to calls for urgent and sweeping reforms on monitoring of construction activity.
The accident caused panic among those who had taken loans and invested their savings on flats in high-rise buildings. “It was the biggest dampener in addition to economic problems and the political situation,” said Ajit Chordia, president, Chennai region, Confederation of Real Estate Developers’ Association of India (CREDAI).
The lull that followed hit the salaried sections hard as they were unable to move into their houses due to delays in construction, or in getting completion certificates from the Chennai Metropolitan Development Authority, which tightened monitoring.
“The usual growth after an upswing in the stock market did not happen. We hope 2015 will be different,” said Arun Kumar, managing director of Casa Grande.
While the number of housing units added to the city in 2014 was around 20,000 — the average per year in Chennai and extended areas since 2011 — the actual absorption was much lower.
“Increased government spending on infrastructure followed by a strong budget will push growth,” said Mr. Chordia. Analysts said, in addition to pockets around Tambaram and Ambattur, they expected areas along Outer Ring Road to witness maximum growth.
“Governments change, budgets are passed, but the lifestyle of the poor remains the same,” said G. Selva of the Communist Party of India (Marxist).
Stating that Chennai was home to several lakh workers, not just from other States but also from backward pockets within Tamil Nadu, he said the Centre and State governments had done very little.
Long-term policies to look into the welfare of this section and recover encroached property belonging to the government will have to be implemented to ensure housing for the poor, he said.