100% FDI in affordable rental housing soon: MoHUA
Real Estate

100% FDI in affordable rental housing soon: MoHUA

In a bid to resurrect from a continuous decline in the housing sales and revive the demand amid the worst hit COVID pandemic, the country’s real estate developers will soon offer over 2.70 lakh ready-to-move-in houses for online sales to the homebuyers in a first and biggest ever housing festival, which will begin soon.

Initiated by National Real Estate Development Council (NAREDCO), in this festival, the developers from all over India will list their housing properties for sale on an exclusively created e-commerce marketplace ‘NAREDCO Housing For All’ developed in guidance with the Ministry of Housing and Urban Affairs. This festival is expected to unlock the affordable housing properties worth over Rs 1.21 lakh crore and offer a great opportunity to the national and international homebuyers to buy RERA registered properties at the right prices anywhere in India.

Hardeep Singh Puri, Minister, Housing and Urban Affairs, Government of India announced the launch of the e-commerce portal and also unveiled  the recently approved ‘Affordable Rental Housing Policy’ knowledge pack to support a huge influx of people in urban India find affordable rental housing. Niranjan Hiranandani, National President, NAREDCO and President, ASSOCHAM; Rajan Bandelkar, Convenor, NAREDCO Housing For All Portal and President- West; Rajeev Talwar, Chairman, NAREDCO; Praveen Jain, Vice Chairman, NAREDCO; and other industry delegates were present at the web-based event. 



Congratulating NAREDCO on launching an innovative e-commerce portal, Hardeep Singh Puri, Minister, Housing and Urban Affairs, said, “The visionary step of creating an e-marketplace for the homebuyers designed by NAREDCO and implementation of the affordable rental housing policy will change the dynamics of the sector, as many people will be able to find their dream houses under these programmes. The Affordable Rental Housing Policy is necessary for migrant workers who cannot afford buying houses and also for younger professionals in the cities. The government has been speedily working towards meeting the Housing For All targets and the demand assessment shows that about 70 per cent of projects have been grounded.”

Responding to a demand raised by NAREDCO for Housing For All Portal about permitting a 100 per cent FDI in affordable rental housing sector, Puri announced that the government will soon allow 100 per cent FDI in affordable rental housing. He also maintained that on the lines the Civil Aviation Ministry, the real estate sector will too have a ‘Permanent Working Group’ to attend any issues or matters pertaining to the sector for faster decision making. 

Durga Shanker Mishra, Secretary, Housing and Urban Affairs, appreciated the initiative and expected positive sentiments to return in the realty sector in the near future. 

The already beleaguered sector is pinning high hopes on this mega online sales for pushing the demand and much needed liquidity. Niranjan Hiranandani, National President of NAREDCO and ASSOCHAM, said, “The real estate sector needs an immediate demand shock and unlocking the potential of unsold housing inventory is the immediate remedy. This e-commerce platform is curated supporting the government’s Digital India initiative, which will not only disrupt sales process but also instil confidence among the respective stakeholders like consumers, developers, banks and financial institutions.” He further added that from an industry perspective, the ARHC scheme will help unlock the potential, as also utilise government lands to create rental housing stock, which will help those at the bottom of the pyramid, ensuring that housing for all becomes a reality for all segments of Indian society”.

Rajeev Talwar, Chairman, NAREDCO, added, “The COVID-19 pandemic has resulted in massive reverse migration of workers and poor migrants in the country who come from rural areas or small towns for seeking better employment opportunities in urban areas. To address this issue so that the same does not happen in future, the Union Cabinet chaired by Prime Minister Narendra Modi has given its approval for developing of Affordable Rental Housing Complexes (AHRCs) for urban migrants/poor as a sub-scheme under Pradhan Mantri Awas Yojana-Urban (PMAY-U).
 
Affordable Rental Housing Complexes will provide social security and quality life to migrant labour, urban poor, and students etc. This will be done through converting government funded houses in the cities into Affordable Rental Housing Complexes (ARHC) under PPP mode through concessionaire. ARHC will create new ecosystem in urban areas making housing available at affordable rent close to the place of work. Investment under ARHCs is expected to create new job opportunities. ARHCs will cut down unnecessary travel, congestion and pollution.”

Praveen Jain, Vice Chairman, NAREDCO, said, “Migrant workers were in need of affordable and convenient rental housing in urban areas especially in big cities like Delhi, Mumbai, Bengaluru, etc, in addition to social security. The government is attentive to the needs to all the segments of economy and society.

Therefore, the finance minister announced a scheme for affordable rental housing complexes for migrant workers and urban poor to provide ease of living at affordable rent under the Pradhan Mantri Awas Yojana. This scheme will extend help to a large part of workforce in manufacturing industries, service providers in hospitality, health, domestic/commercial establishments, and construction or other sectors, labourers, students etc. who come from rural areas or small towns seeking better opportunities in cities.”

Explaining about the portal, Rajan Bandelkar, Convenor, NAREDCO Housing For All Portal and President-West, said, “This biggest online marketplace will offer the discerned buyers right home buying options at the best prices. This will act as a trusted, secured and seamless platform for home buyers in India and abroad. This will also bring down the inventory turnover time of developers drastically improving their cash flows.” He informed that more than 250 projects have already been live on the portal. He also appealed to the Ministry to resolve long pending demands of 100 per cent FDI in the affordable housing sector and one time restructuring of loans. 

The portal will display RERA registered projects and there will be third party document verification for all the projects listed on the site. The homebuyers will be able to seek the best pricing, home loan offers and book the properties online directly with the developers. It will offer a safe and convenient property surfing and buying experience with assurance and guidance from NAREDCO. Like any other e-commerce goods buying platform, this portal will also offer facilities like cash back and price match guarantee. On the other hand, this will help the developers in easing liquidity pressures, both in terms of sales and marketing initiatives through cost savings.  

The launch of a ‘NAREDCO Housing For All’ e-marketplace has assumed significance owing to unprecedented disruption across the country’s real estate sector with dampening sales and new project launches. The lukewarm approach of homebuyers delaying their buying plans has further added to the woes of the sector, which was already battling pre-pandemic liquidity and NBFC crisis. 

Though the government introduced a slew of measures in the recent past to inject liquidity into the sector in terms of extending the CLSS benefits, extension of moratorium, etc, the developers have been asking for more prescriptions such as one time restructuring of loans, reintroduction of subvention schemes, 100 per cent FDI in completed housing projects, other sops that will benefit the industry.

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