Government to launch low-cost housing project

Apartments for workers, low-wage employees

Bhavanam Foundation Kerala (BFK), a company formed by the State government to address housing needs of labourers, workers, and low-wage employees, is set to launch ‘Janani,’ an affordable housing scheme.

The project will be launched in Kochi or Thiruvananthapuram or both, according to availability of land.

The first phase of the project consists of 400 apartments of 700 sq ft each. The cost of each apartment will be around Rs.10 lakh. The apartments will be built under Build Operate and Transfer (BOT) model through Public Private Partnership (PPP). Innovative construction methods will be used for reducing the cost to the minimum.

The process of selection of operating entities for executing the project is under way. The company had been trying to get aid under the prevailing schemes of the Central government, but there was lack of clarity on certain subjects and the State was going ahead with its own scheme at present, a top official of the project told The Hindu .

Land measuring over 200 cents, located within 15-20 km radius of city limits, is required for the project. If the entire lot of land is not available in one city, the project could be bifurcated.

Tripartite agreement

Under the scheme, each beneficiary of the scheme will have to invest Rs.2 lakh initially. The remaining cost will be raised by BFK and loans will be offered to beneficiaries at concessional rate of interest. The beneficiaries will have to repay the loans in equated monthly instalments over 15-20 years. The process of identifying the beneficiaries would begin soon.

The loan will be released by BFK to the operating partner under a tripartite agreement among BFK, beneficiary, and operating partner. BFK will have mortgage right over the land while the operating entity will have mortgage right over the apartments allocated to the beneficiaries as security. The operator will be permitted to construct apartments in the project at its own cost and sell them at market rate to general public so as to reduce the overall cost of the apartments offered to beneficiaries under the scheme.