Land Reforms – A Possible Catalyst for Affordable Housing in India

The aspiration of home ownership has strengthened since the NDA Government announce affordable housing initiative. However, land reforms in India need improvement to support the initiative to meet the promise of housing for all.

Land isn’t just the foundation of a concrete structure; it is the ground that transforms dreams into reality. From top Indian cities to rural India, every city has its share of affordable housing projects. However, the soaring land prices and inflation, make an affordable home look beyond buying potential. Amongst many, land prices and acquisition are the primary reasons for property price rise.

Here, we elaborate on how land reforms can boost affordable housing but before that here what needs to be focused.

Land Reforms Challenges in India

• The erstwhile abundance of land is now witnessing a decline, therefore disbalancing demand and supply. As economics schools, value increases with supply shortfall; the limited land availability burns a hole in developers’ pockets.
• The rising land cost translates into high value residential properties; therefore, even affordable housing looks distant from cost-efficiency viewpoint. Thus, now is the right time to introduce land reforms in India.
• Along with equitable distribution, old regime laws and socio-political scenarios contribute to many hurdles for land disbursal.

Necessary Land Reforms to boost Affordable Housing in India

Post 2015, affordable housing is not only a slogan, but it has become a truth for lakhs of families, from rural to urban India. While initiatives like subsidy and waiver on interest on home loan continues to encourage homebuyers, lack of land reforms derails the momentum. Therefore, making a slight slowdown in housing inventory.

Streamlining Land Deals

Talking about affordable housing in urban cities, new land reforms in India are significant to bring down prices for housing properties. The curtailing of land cost, which accounts for almost 50-60 percent of housing expense, can be brought down.

With a focus on land with minimum utilization and a fast approval procedure, land reforms in India can act as a catalyst for affordable housing.

Increase in FAR (Floor-Area-Ratio)

Niti Aayog’s member, Rajiv Gauba, comment to dedicate 10 per cent share for residential properties in the master plan makes sense. Also, the increase in FARs (Floor Area Ratio) by approximately two-fold will allow layout for more units per floor.

Increase in FAR? Is it a valid question in today’s time, when there are the best residential properties with only two apartments per floor for sale? Well, yes, the expansion of FAR will add more units to the layout, therefore fostering community living and making it easier to choose a home with a preferential view.

Land Pooling Policy in India

The policy needs refinement, amid gaining popularity amongst end-users, homebuyers, and investors. With a smart land pooling policy, the acquisition of large land parcels for gigantic projects becomes easy. It is one amongst many important land reforms in India necessary to ease way for affordable housing.

New Schemes

The induction of incentives like stamp duty waiver and GST offering on (1% on units under revised caps like Rs. 90 lakh) will enhance feasibility. How will it make residential properties cheaper in India? Yes, the single-window clearance speeds up the land acquisition procedure, and digital land records ensure transparency in compensation disbursal. Therefore, participation in land title transfer increases.

This increase leads to quicker commencement of work on projects. Thus, maintaining the flow of timely possession for affordable homes.

Benefits of Land Reforms in India

Fast-Track Process

With technological advancement shaping every sector, the digitization of land records is a notable step. The timely updates, clear title holders, and quick disbursal of compensation ease land acquisition. Therefore, simplifying the route for affordable housing in India is the best way possible.

It also lowers delays by over 90 per cent as mutations and eliminate other departmental late comings. Also, the app and website portals backed by governments, including States, encourage citizen self-reliance and lower dependency on the system.

Monetary Gains

Being a farming-oriented civilization, India’s biggest concern is to meet farmers’ expectations. The secure framework to announce the legal rights of land owners, lure FDI, and thus empowers nation’s economic scale.

Better Occupancy Rate

The streamlined process, transparency in functioning, and ownership together build an ecosystem for quick disbursal of land. Therefore, quick land buying and the start of the project lead to swift occupancy as developers can offer possession in accordance with their timelines.

How GIS can be a Game Changer for Land Reforms in India?

GIS, i.e., Geographic Information System, is a revolution in Indian land reforms, as it maps the land accurately. With digitization and transparency as two cornerstone features of the GIS technology, there remains no scope of fraudulence in asset value.

GIS, is playing an impeccable role in creating data records with the highest level of accuracy. The geo-enabled digital land banks, integration with the Digital India Land Records Monetization Programme, and land reforms are evolving in the country.

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