Now private real estate developers are in favour of annuity and capital grant based models to construct affordable housing on government land under the Pradhan Mantri Aawas Yojana (PMAY) . Utilizing government lands for affordable housing development purpose is the right way through which private realty firms are take over the budget housing segment- which is apparently the growth driver of current realty standing. Opting for government-owned lands will set them free from land purchase litigation and other co-related investment peeve.
After July 31, developers will be bound by RERA criterion and this annuity/ capital grant based models will be commenced and delivered by specified timeline. PMAY scheme was introduced on June 25, 2015 with an aim to provide budget residential apartments for bottom class of the pyramid by 2022. However, private real estate companies were kept on slipping out of the grip of this sector in particular. Land scarcity, high land cost and dearth of the construction capital had been several major blocks towards the achievement of the project goal. By far only eight PPP projects have been kicked off for affordable housing category, built on government land.
The government of late outlined a model draft public private partnership (PPP) policy, with six PPP models to assist the partaking of private sector. The draft policy is in the public domain for proposal and observation by June 30 from all-purpose and stakeholder. Under the annuity based subsidised housing (ABSH) model, the government will provide land for development and the developer will obtain revenue from the government in the form of standard annuity payments for a certain period of time(15-20 yrs).
“There are several big private players are participating in the development works of low budget flats in Kolkata . These apartments are mostly being developed in the outskirt areas of the city and the average apartment size is 600-800 sq ft,-said Mr. Mahesh Somani West Bengal RERA and realty expert.
Asking about the booming development areas, Mr. Somani also added, “Along with Rajarhat, Garia, Lake Town, Narendrapur and Tollygunge are the areas which will be emerging as the best-sellers of affordable flats in Kolkata segment in coming days.”