Indicates that according to Ashwinder R. Singh, the Vice-Chairman of BCD Group, India's housing market is lacking its lower-priced housing options.
In India, the supply of affordable housing below Rs. 50 lakh is shrinking, posing a significant challenge to the lower-income groups and the country's inclusive urban growth. According to Ashwinder R. Singh, Vice-Chairman & CEO of BCD Group and Chairman of the CII Real Estate Committee, this issue is rooted in economic viability due to rising costs, regulatory burdens, and a perception that affordable housing is less prestigious within the industry.
The problem stems from escalating costs across land, materials, labor, and compliance, making affordable projects economically unviable for developers. Adding to the challenge, government schemes like the Affordable Housing Policy (AHP) and Credit Linked Subsidy Scheme (CLSS) face targeting inefficiencies, with a large portion of the economically weaker sections (EWS) unable to access benefits due to informal employment and lack of documentation.
To address this issue, Singh proposes several solutions:
- Government support for reducing land costs through subsidised land allocation and capping sale prices to improve project feasibility.
- Fiscal incentives such as subsidies, reduced stamp duties, tax rationalization, and the reinstatement of input tax credits to enhance developer viability.
- Streamlining approvals by simplifying regulatory processes to reduce delays and costs.
- Encouraging innovative construction technologies, like Mivan pre-engineered and prefab structures, to cut costs and improve efficiency.
- Implementing buyer lock-in mechanisms to prevent speculative sales and keep housing affordable for intended beneficiaries.
Singh emphasises that affordability must be embraced as a central sector goal rather than a secondary pursuit. Without structural reforms in cost controls and regulatory ease, India's affordable housing supply will continue to fall short of demand, threatening inclusive urban growth.
Moreover, Singh highlights the need to rethink affordable projects as modern communities that are EV-ready, climate-resilient, and digitally connected. He argues that India's urban future cannot rest on luxury towers alone; a housing ladder without its first two rungs traps families in rental stress, magnifies urban sprawl, and throttles productivity.
Capital continues to favour premium projects, with banks and funds applying stricter lending norms and lower exposure limits to budget housing. However, Singh argues that affordable developers build social mobility, with each 1,000 units creating about 1,800 direct and indirect jobs, according to the Ministry of Housing.
In conclusion, the challenge is economic viability in the affordable segment due to rising costs, regulatory burdens, and perception issues. The solutions involve government intervention in land and fiscal policy, regulatory simplification, technology adoption, and anti-speculation measures to revive and sustain affordable housing supply in India. If India aims for a $5-trillion economy, it must restore dignity—and profitability—to the business of building affordable homes.
- The business of building affordable homes faces a challenge due to economic unviability caused by rising costs, regulatory burdens, and perception issues in the industry.
- To stimulate the affordable housing sector, the government could implement measures such as subsidized land allocation, fiscal incentives, and simplified regulatory processes.
- A sustainable future for India's urban growth requires a rethinking of affordable housing projects as modern, climate-resilient, and digitally connected communities that provide social mobility and help restore profitability to the business of affordable housing.
