AP Rajiv Swagruha Welcomes
Distinguished Delegates to – International Conference
of NHB - APUHF
30-31, JANUARY 2012Shalini Misra, IAS
Managing Director, APRSCL
PRACTITIONERS IN EMERGING AFFORDABLE HOUSING MARKETS
Practitioner -APRSCL
• SPV under companies act for moderate income ( Rs. 2.00 – Rs. 10.00 lakhs p.a)
• Four and half year old organization• Demand of 1.76 lakh housing (70% SBR &
DBR)
• Constructing 139.10 M Sft • Spread in two and three tier towns also
Practitioner -APRSCL
• 24 townships under construction• Three townships completed and
inhabited• 5000 acres land bank – Rs. 6000 Crores• Created Asset value Rs.4500 Crores
Rajiv Swagruha • Unique and innovative • Self financed and demand driven• Non – budgeted and no subsidy• No exemptions• Sale cost 25% < market value• Integrated gated self contained strategically
located townships• City specific layouts, house designs, and patterns• Different sizes of houses • Green building norms
Rajiv Swagruha • Full infrastructure package like roads, water
supply, underground utilities, landscaped gardens, STP, water harvesting, firefighting system etc.,• Lifts (passenger & cargo) - generator back up• Facilities like piped gas supply, solar water
heating systems, car parking (charged)• Recreational & Commercial spaces, hospitals,
club etc., (not charged)• Construction as per NBC and BIS
Premium lifestyle at affordable cost
Buyers Psychology
• Monetarily rewarding and emotionally gratifying• Home where morning starts with chirping of birds• Integrated township safe and secure• Comforts like thematic parks, playgrounds• Commercial spaces – market at door step• Hospital at max distance of 1 to 2 Kms• School / offices – convenient transport• Recreational facilities within• Other status symbols – club at arms length
Buyers Psychology
• In SFS buyer has to pay the cost in installments – synchronized to physical progress of construction • Moderate income group cannot pay rents and
EMI together• Moratorium period of home loan is not
coterminous with the construction time• Buyer wants to pay when the house is “ready
to occupy”
Questions in Mind
• What is an “affordable House” ?• Will it be adequate and appropriate to my requirement?• Where can we get a quality affordable house ?• Am I eligible to apply for this ?• How much will it cost ?• Where will I get loan ?• What will be the EMI ?• What will be the maintenance cost • What are the transport facilities and amenities ?
Affordable Housing
• Affordability is the ratio of cost to income• Cost of living in that house (core, peripheral)• Quality of life• Transport & communication availability• Facilities & amenities- convenience• Maintenance cost for decent living
Rajiv Swagruha -Philosophy• “Affordable housing is not about box sized budget homes in far flung places where there is no connectivity to work places and little surrounding infrastructure”• An affordable house does not mean a substandard house or any compromise on space, quality or facilities as required by the family• Affordable Housing has to cut across all income segments of the society and has to make economic sense – inclusive / complementary housing
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Rajiv Swagruha -Philosophy
• Demand of affordable quality homes is in the price range of Rs.15 – 30 lakhs. Rajiv Swagruha range Rs.6.30 – Rs.36 lakhs
• Swagruha - necessity for many, opportunity for few and growth engine for Government - Inclusive growth
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Is affordability and adequacy both possible
• Yes• Rajiv Swagruha before finalizing detailed requirements, observed number of families living in different sizes of houses and flats and planned “an adequate housing”, followed up with no of exercises and negotiations to make it affordable with highest quality. • It offers choice in location, cost, sizes and pattern as well
Hassle-free life
An adequate affordable housing –Swagruha
• Income level - variety of sizes and pattern of construction• Size of the household – Delinked with
income level & co applicant allowed • Composition of the household – joint family• Profession – IT / Employees• Age – senior citizen – Prashanthi enclave • Aspirations – upward movement• Stability- covering two & three tier cities
Rajiv Swagruha – How affordable
• High land prices – optimization of land use• Cost of construction – on schedule completion• Transaction cost – No cost within the township• Profit margins - volumes and spread• Limited competition – 25% less than the market• Slow supply – demand driven and self financed• Outdated technologies – fast and cost effective
technologies used (Shirke & Mivan)
Affordable Cost Range
Sl.No Category and area Cost range in Rs. lakhs
1 Exotic (1599 Sft) 35.00 - 40.00
2 Classic (1487 Sft) 22.50 - 36.00
3 Intrinsic (1150 Sft) 17.40 - 25.00
4 Basic (798 Sft) 10.80 - 18.00
5 Civic (545 Sft) 6.30 - 11.35
No Hidden costs and extras
Buyer
APRSCL Bank / FI’s
Tripartite win – win relation
Building Trust
Issues
• Home loan under priority sector (10 areas)• No sub target for housing• Bridge loan under commercial Real estate• 150% risk factor• Absence of clarity and consensus• No Indian urban planned development &
vision• Mind set change of policy makers • Tax holiday for limited period• Concentration to shift to all urban areas
Issues • Govt initiated are tilted • It gives rise to skewed unorganized urban
growth and development• Supply has to respond to requirement in
different segments otherwise we might have surplus in some while shortage in some others
• A clear understanding of the nature of housing problem is an essential pre-requisite for formulating appropriate policies which have to be directed towards meeting requirements of all sections of population – inclusive complementary growth
Is Rajiv Swagruha CRE ?
Subsidized
Needy & political
Poor
No monetary commitment – Free
Limitless
Affordable ?
Needy & Non political
ModerateHard earned money, deliberate saving, Home loans
First House Missing - Advocacy
Real estate
Business & investment
Rich
Surplus money
2nd House onwards
Categories of Housing initiative
Success formula
• Long term loans (Home and bridge ) at concessional rate of interest
• Recognizing affordable self financing housing under priority sector in its totality
• Addressing full segment of population in an integrated manner
Seeing is believing … visit us
THANK YOU
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