Corporates plan to build cheaper homes for low-income groups

Corporates are vying to tap the affordable homes market for economic weaker sections (EWS) and low-income groups (LIG) and are planning various models to build efficient and cheap homes.

Although the prices per square feet is unlikely to go down due to rising prices of cement, steel and sand, corporates expect the houses could be priced between Rs 12 lakh and Rs 20 lakh to target low income group, middle income group and economically weaker sections.

Speaking on the sidelines of Confederation of Indian Industry conference here on Affordable Housing for all, Sangeeta Prasad, chief executive officer of Mahindra World City, told City Express that Mahindra Lifespaces is looking for lands in Tamil Nadu and Maharashtra to build homes for middle income group, low income group and economic weaker sections for below Rs 20 lakh. The land, likely to be near Chennai and Mumbai, will be developed after Mahindra got right partners, she said and added that there is a need to have an innovative eco-system to provide the design and construct homes for the economically weaker sections.

“The loans should be given with concessional interest rate and a financial mechanism should be worked out to help the economically weaker section get loans,” she said.

“As these people are from informal sector, they are denied loans by the banks as their income is anywhere between Rs 500 and Rs 12,000,” Sangeetha said, stressing on the need for the EWS to have access to funds.

Ajit Chordia, vice-chairman of Indian Green Building Council, Chennai chapter, and managing director of Olympia Techpark Limited, highlighted the need for do-it-yourself kit for building homes.

He said, to build  homes with a budget below Rs 20 lakh, one has to shift from brick and mortar to aluminium formwork  and pre-cast method and the land has to be provided by the government.

He said that 20 to 25 per cent of the cost of the materials go into taxes. Chief construction technical officer of Value and Budget housing corporation Limited Alejandro R Morales said that the company’s objective is to provide housing that meets high quality standards at a low cost. However, the cost per square feet cannot be reduced due to the rising cost of cement, sand and steel prices, he said. 

The company applies contemporary building technology and adopts ingenious industrial engineering processes to construct homes, he added.