Even as the dream of owning a house for millions of Indians remains one, real estate developer Niranjan Hiranandani attributes the present dismal situation to a severe leadership crisis in the sector.
The crisis (leadership) is not just within the Government, but also among private developers, he observes.
“There is not enough commitment from the Government to create new housing. Instead, their focus is on regulating the sector which has actually led to strangulating the sector,” says Hiranandani, speaking to
He adds that developing affordable housing in the country is a daunting task.
Though there are several causes, the real estate major states that chief among them are economic, regulatory and urban issues such as the lack of availability of urban land, rising construction costs and the lack of access to home finance. A report by research firm Jones Lang LaSalle has highlighted another factor.
It indicates that though some of the challenges are gradually being mitigated, the Government is trying to excessively control the volume of construction in centrally located areas. The Government is also making land recycling methods complicated, which results in urban areas shifting to the periphery, adds the report.
But the 62-year-old real estate entrepreneur is categorical that the primary cause is the lack of leadership.
“Leadership in both Government and private builders has to create an enabling environment. Urban infrastructure is happening, but not fast enough. We need new leadership to tackle new products in housing. There is an urgent need for change,” he says.
Suggesting a cross-subsidy with differential pricing as a solution, Hiranandani says, “We have cross subsidy for the poor in education and food. In a similar manner, we should have a system wherein we give housing on rent to the poor, while the ownership rests with the Government. There should be an incentive to build.”