Affordable housing continues to remain a mirage for middle-income category households and the salaried class in the city owing to spiralling land cost.
As per the 33rd GST Council meeting held early this year, affordable housing was defined as flats with a value up to ₹45 lakh with a carpet area of up to 90 sqm or 970 sq.ft. in case of non-metros.
But members of the Builders’ Association of India, Mysuru, point out that given the premium on land, it was impossible to construct individual row-type houses of multi-storey apartments at the prevailing land cost.
They argued that only government agencies, like the Mysuru Urban Development Authority (MUDA), and not private builders can subsidise the land cost and pass on the benefit to the end users.
N. Subramanya of BAI Mysuru told The Hindu that not withstanding the demonetisation in 2016 and its impact on real estate, people are coming to terms with it and the inevitability of transactions in white by paying taxes. As a result, the market was stabilising.
But none of it had any impact on land cost which continues to remain high and accounts for more than 50% of the total housing cost, he added.
“In parts of Mysuru, people were quoting figures ranging from ₹12,000 per sq.ft. to ₹15,000 per sq.ft. in places such as Vijayanagar, near M.G. Road, and the surrounding areas,” said Mr. Subramanya. In such a scenario, affordable housing will remain a chimera, he added.
Meanwhile, the MUDA’s foray into affordable housing through multi-storey apartments has remained a non-starter.
Suresh Babu, Superintending Engineer of MUDA, said the norms are yet to be finalised and hence the project was getting delayed.
He admitted that there was no major push for any projects as of now, as there was a government directive that the authority should confine itself to creating new layouts.
“There is a directive that the local bodies will deal with infrastructure in their area of jurisdiction and MUDA should confine itself to developing layouts,” he added.
Besides, there is an inventory of around 1,500 to 2,000 housing units in the city and builders are keen to dispose them before launching new ventures as a result of which housing construction is witnessing a lull.
However, most of these apartments are above the ₹45 lakh limit set by the GST Council and do not come under the “affordable” category.
But there is a gradual realisation among the stakeholders that given the paucity of land, vertical growth will gather steam and hence Mysuru is likely to witness an increase in the number of multi-storey apartments in the coming years.
But whether it will be affordable will depend on the land cost.
