Pune

Rahul Wadke's dream of owning a home-sweet-home in the city is not turning out to be an affordable one.

With an income of Rs 20,000 a month, the 40-year-old autorickshaw driver has been planning to invest in a Rs 10-15 lakh flat in Pune ever since the Centre announced its affordable housing scheme. "The affordable housing projects in the city are beyond my budget. I have to focus on the outskirts," he said.

The Union government has issued a notification according infrastructure status to the affordable housing — a project that uses 50% of the floor space index (FSI) for a dwelling unit with a carpet area of not more than 60 sq m.

Statistics reveal that 60% of the demands for such houses are from the groups represented by people like Wadke. The ground reality is not even 10% of people from the segment can avail of the benefits, unless the government declares some sops for both the developers and buyers.

Developers engaged in low-cost housing projects said those in the middle income group would reap benefits of the scheme. "The area should have been between 30 sq m and 40 sq m. Most buyers representing the low-income group do not have that amount of cash. They also do not meet the banks' conditions to get loans. This segment will not be able to enjoy the benefits of the scheme.''

The Confederation of Real Estate Developers' Associations of India's Maharashtra chapter president, Shantilal Katariya, said while the ministry of commerce has issued the notification under the infrastructure status, developers would not get loans unless the Reserve Bank of India issued guidelines to the banks.

During a meeting with the Prime Minister's Office last week, Credai-Maharashtra sought some assistance to help speed up the projects. "We need loans at 6-7% interest rates. Besides, infrastructure should be in place in the areas where such projects are coming up. Stamp duty should be waived and partnership models initiated where plots are given to builders to build affordable houses,'' said Katariya, who is working at the the national level on the project. 

He said affordable housing projects can up come up within the corporation limits if development and premium charges, scrutiny fees and an increased FSI were provided to the developers. Citizens said for a person with a monthly income of Rs 40,000, the maximum loan limit would be around Rs 20 lakh. Citizen's group Nagari Hakk Samiti's Gurbir Singh said the affordable housing project "is not affordable for the low income group".

He added that such projects were not affordable in the main city areas of Mumbai and Bengaluru as well.