Address by the President, CREDAI-Odisha Chapter with suggestions on Affordable Housing Policy

Address by the President, CREDAI-Odisha Chapter with suggestions on Affordable Housing Policy

We, CREDAI-Odisha welcome the State Govt. policy for affordable housing. We do understand the real demand, which is the need of hour, should not be addressed by Govt. only but also by Private participation.
 
We are very glad to utter that there is so many Central Govt. initiatives and a number of steps have been taken to solve this problem by different schemes like JNNURM, Integrated Housing and Slum Development Programme ( I H S D P ) & RAY schemes but sorry to state that these are confined to few cities.  This scheme of affordable housing were started  many years back but  came to an end automatically due to shortage of funds, may be from centre or state,  for different reasons.
 
In the present context, the aim of all the participants is to revitalize & popularize the schemes for providing “Affordable Houses” to the needy families, so that many private entrepreneurs can come forward for this noble cause “Home for All” with the essence ‘home should be in affordable cost by analyzing the history, we should come to a consensus that it is not practicable to achieve any noble target at the cost of others.  Hence, some tangible benefits should be offered to promote affordable housing.
 
Our policy models are: -   Model – I, II & III by Govt. of Odisha
OSHB shall construct the EWS,  LIG, LMIG & MIG  60% of total built up   area getting  Govt. land in subsidized rate and other land for HIG  and commercial use enjoying other facilities for affordable housing like free land, exemption  of  conversion   charges, stamp duties as well as F A R, T  D R, V AT  etc.
 
Concerns:-

• Like OSHB other private developers should be encouraged for this scheme as massive stocks to be generated for EWS & LIG house.
• VGF (Viability Gap Funding) should be provided from Central / State Govt. schemes to only OSHB.
• All other facilities like FAR, TDR, external development, free land for EWS & LIG, free conversions, stamp duty & other facilities for easy loan should be exempted or subsidized as per Govt.  Policy for OSHB as special incentives.
• The OSHB has been given option to change the scheme to HIG after getting the land for EWS, LIG etc, VGF which is provided to OSHB for affordable Housing.

 
CREDAI Suggestions:-     

To sustainable & Inclusive growth of Affordable Housing

1. The incentives proposed to be provided to OSHB should also be extended to all the participants in the cause like, NGOs, private builders as no discrimination should be made.
2. Where land is given either in subsidized or free of cost the proposal of giving a hand to use 60% of the said land for EWS, LIG and 40% for HIG should be amended to the effect that the entire area should be meant for EWS, LIG.MIG houses under affordable housing scheme and it should not be mixed up with HIG.
3. The incentives should pass on directly to the beneficiaries and accordingly the cost of the house should be subsidized & FAR should be 50% extra than normal.
4. In case of own land purchased by the developer /OSHB interested  one may opt  for this affordable  schemes but  can move ahead at least with  1 Acre of land instead of 5 AC fully for the scheme.
5. The cost of the unit should not be more than Rs.1, 500/- per sqft excluding the land cost & if other incentives will be passed on, then SQFT cost can be reduced accordingly.
6. The VGF should not be more than 40% & it should be refunded without interest like project loan and can be used for other projects once the project is viable to be monitored by H & UD Department.
7. To make it mandatory for all the developers 5% of total super built up area to be marked for these schemes  for land 1ac > 5ac and they   can construct in consortium also in specific project not in the same project where so many difficulties arises because -

• This policy being experimented by AP, MP states have given back fire and they have modified it.  Therefore, we should either follow A.P.s modified procedures which is giving good results.  The policy of shifting the cost for affordable housing to public intending purchases of HIG and other houses will affect directly the interest of the people of the state.  In this case the A.P modification No- Goms-245, Date- 30-06-2012 may kindly be referred. Shelter fund may be collected in proportionate to land cost & FAR given for the development in an area of land more than 1 AC less than 5 AC.
• Alternately if Govt. wishes to mandate 10% of the total area in respective in all HIG Projects for more than 5 Acres of land then it should be purchased by the direct HIG beneficiaries for use of their servant quarters which indirectly solve the socio economic issues arise in the same premises or the builder can separate the same units inside the premises or 5 kms away from the Municipality area.

Rental Housing for Affordable Housing Project:

To  arrest further slump growth (30% population) rental housing to be created  with the help of Central Govt. funding like RAY, Integrated  Housing  & Slum Development Programme & JNNURM Schemes, MMRDA (Maharastra) rental housing to be adopted as a role model.
The one room houses of 120 sqft carpet area can be designed to resist the slum growth & Govt. should be very much pro active to implement with the help of other NGO, Private Builder & ULB. 

ELIGIBILITY CRITERIA:

For selection of Private Developers & Beneficiaries.

• The Govt. has kept very nice criteria’s like experience and net worth which is absolutely fine.

Suggestions:-

• Under this scheme if a developer is interested at least with 1 acre of land he should be encouraged instead of 20,000 sqft. Only for this scheme.
• The builders /Developers should be motivated to construct in Joint venture or SPV mode but without intending for any profit mode with all other support discussed earlier from Govt.
• This effort should be recognized by Govt. of India & schemes to be connected with CSR activities.

For Beneficiaries:- 

• There should be I T Returns whatever the income varies from-

      Gross Income-   EWS- Rs.5000                        :           10,000 per month
                                                LIG- Rs.10, 000         :           15,000 per month
                                                MIG-Rs.15, 000         :           20,000 per month

• If any house or plot is found in the name of beneficiaries before or after the allocation, then the house will be cancelled automatically & proper law should be framed to evict.  The  scheme should be availed  for the bonafide residents of Odisha,

Project Approval:-

• Still there is a lot of confusion in approval of ‘Urban area’ & ‘Rural area’.  Development authorities may act in their Municipality area for single windows approval for this scheme and other schemes also as it gives a lot of financial burden to the project for delay in approval for which our main motto of affordability is defeated.
• For urban areas the selected committee members are appreciated to take all decisions for policy & approval.
• In rural areas, there should be a body under the Chairmanship of Collector with members as PD DRDA, Town Planning Authority, Local Authorities & concern BDO for approval & monitoring of the project from time to time. The generated report will be reviewed by Apex Body in State Level.

For Govt of India:  

Incentives to popularize the schemes:-.

• The schemes to be connected to CSR activities under Corporate Affair Ministry’s guide lines.
• Affordable housing be treated as Priority Sector & Real Estate be considered as infrastructure and guidelines for banking may substantially modified to accommodated.
• Capital gain tax to be at par with stock trading.
• Mortgage guarantee fund and direct subsidy to the purchaser of  EWS & LIG Houses for capital cost & for maintenance a Corpus fund should be created.
• State Government:
• Removal /enhancing the permissible FAR.
• 100% discount on stamp duty & VAT for the purchasing of EWS LIG homes.
• Zone conversions of land for affordable housing & conversion to be prompt and free of charge for this.
• Single window clearance within a month.
• Proactive slum rehabilitation schemes.

 
ROLE & RESPONSIBILITIES:-

Fortunately now we the builders of CREDAI giving stress on Affordable Housing ranging from 8 lakhs to 20 lakhs on the periphery of Bhubaneswar Municipality area & also there is few scopes for HIG customers of Odisha to purchase as already they have their house. One of the schemes we will represent i.e. “Chandaka Meadows”. Er. Umesh Patnaik and G.S.will explain all about his project. Once this type of project come up with the other incentives to the beneficiaries & the builders their 60% of this problem will be solved automatically.             
On behalf of CREDAI Odisha chapter, we assure to provide all time support in this noble cause with pragmatic approach.  Since we are in a better position to study the prevailing conditions in the field, we hope, Govt. may effectively share our experiences in varied related problems and its solutions for the bonafide residents of Odisha, Last but not the least, I take leave to announce on behalf of CREDAI-Odisha that we could deliver one lakh sq ft construction area every year, by implementing this scheme, should Govt. co-operate with us by providing suitable government land.
 
P R E S I D E N T  C R E D A I -   O D I S H A