Modi government's booster shot! 2.5 lakh stuck housing units may get a new lease of life

In a relief to the homebuyers, Finance Minister Nirmala Sitharaman recently announced the setting-up of a special window of Rs 10,000 crore for last-mile funding of distressed affordable and mid-segment homes. According to the latest research by ANAROCK, nearly 2.5 lakh units across the top 7 cities will be benefitted from the government’s aid in the top 7 cities. Nearly 63 per cent of the total stuck/delayed units (about 4 lakh units) may see a flicker of hope.

The report stated that a total of 4 lakh units of projects launched in 2013 or before are stuck or delayed across various segments, excluding NCLT projects. Of these, only those fall under the affordable or mid categories, approximately 2.5 lakh units, can avail of the government’s new provisions. However, there is no simple yardstick to calculate the exact number of units and the actual funds that are needed to complete them. Each delayed project is of different size, stage of completion, city and micro-location, etc. Also, various methodologies have been used to reach the approximate number.

"While this move is commendable, the government need to change its definition of ‘affordable’ housing. As it stands today, the government labels a metro-based home as affordable in metros if it admeasures 60 sq. mt. or less in carpet area and is priced within INR 45 lakhs. This price tag is far too low in cities such as Delhi-NCR and Mumbai. Moreover, the price definition of mid-segment homes is also not clear,” the report said.

City-level break-up

* Mumbai Metropolitan Region (MMR) has the highest qualifying stock with 92,350 units (37% share) with at least 60,000 units in the affordable category
* Pune comes next with 67,240 units - a 27% overall share
* While projects by Jaypee, Amrapali and Unitech in NCR do not qualify, at least 60,700 homes across the entire region may see revival. At least 30,030 units are in the affordable category, the remaining in the mid-segment.
* In Bangalore, Hyderabad and Chennai, merely 9 percent of the total units can avail of the government’s benefit when it is implemented. These three markets have a combined inventory of 22,040 delayed units that fall under the sub-range of Rs 80 lakhs, the maximum being in Bengaluru with 11,880 units, followed by Chennai with 8,960 units and Hyderabad with 1,200 units.
*In Kolkata, at least 9,600 stressed units will be eligible for the government’s relief.