The announcement made by the Finance Minister in the interim finance budget to launch a housing scheme for middle class people living in rented homes or in unorganised tenements as well as thrust on infrastructure and railway projects is expected to provide an impetus to the real estate sector , according to real estate developers.
Post COVID the momentum for home ownership has continued to gain strength and the government plans to take its ‘housing for all’ initiative a step further. While the details of the scheme are yet to be spelt out, the FM’s speech said that it would help sections of the middle class living in slums, chawls and rented premises to buy or build their own homes.
“This is likely to free encroachment areas like slums for easier redevelopment,” said Anuj Puri, Chairman, ANAROCK Group.
The speech also mentioned building two crore more affordable houses over the next five years under the PM Awas Yojana (Grameen), in addition to the three crore houses already under implementation. The estimates for FY25 show that the outlay under PMAY, both urban and rural, has increased 49 per cent from FY24 to ₹80,671 crore. In FY23 the outlay was ₹73615 crore.
“By facilitating home ownership, the government is not only looking to improve living standards but also to stimulate the real estate sector and associated industries,” said Sandeep Runwal of Runwal Developers.
“At this pace it will take us more than 10 years to reach PM Modi’s target,” pointed out Abhishek Kiran Gupta, CEO, CRE Matrix and IndexTap, on more affordable houses.
Development of state capitals such as Jaipur, Lucknow, Kochi, Chandigarh would encourage housing development and reverse the migration to metros. “India needs greater impetus on infrastructure development so that more land becomes available for unlocking value,” he added.
The focus on infrastructure as a booster for housing was also stressed on by Puri who said that transit oriented development in urban areas would increase housing demand in cities and lead to a rise in residential prices, especially in tier 1, 2 cities.