To meet its target of providing housing to all by 2022, the government alongwith the private sector needs to work to increase the supply of low-income houses, which would translate into business opportunity of Rs nine lakh crore for the developers, a recent report said.
"To realise the dreams of millions, the government, private sector and other stakeholders have to play their part to improve affordability of homes for the low-income customer," advisory firm Deloitte said.
According to its survey, the low-income housing segment is estimated to be worth Rs nine lakh crore for developers and Rs seven lakh crore for housing finance companies.
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The report said the initial attempt of providing housing for the urban poor failed to keep up with the rapid urbanisation, which led to low-income families living in cramped accommodations with limited civic amenities.
The government estimates a shortage of more than 18 million homes, of which 95 per cent are in the EWS and LIG segment (families earning up to Rs 16,000 per month).
A study of 22 cities showed that at least 30,500 units below Rs 10 lakh have been launched in 132 projects across those markets in the period between June 2011 to January 2013.
These cities, including Ahmedabad, Mumbai and Indore, have developed well with over 20 projects in each city providing housing below Rs 10 lakh, it said.
Further, around 30 per cent of the supply is priced below Rs 6 lakh and developers are constructing smaller units such as one-room kitchen in these cities which are more affordable and they sell 25 per cent quicker compared to larger formats like 1 or 2 BHK apartments, the report said.
Access to housing finance for formal and informal low-income customers has also improved, the report said, adding that number of new players have entered this market and today over 10 companies are serving the low-income customer.
These new companies have a combined loan portfolio of Rs 1,000 crore, and are growing at 100-300 per cent per annum and have near zero NPAs.
