Track2Realty Pan-India Survey
Bottom Line: The homeless and the home aspiring Indians across the country blame the momentum traders are spoiling the housing market.
There is a general feeling that a nexus of greedy investors, speculators and under-writers is responsible for the price index to shoot up during the Bull Run and this greed driven housing economy often leads to the market collapse.
These investors, speculators and under-writers are defined as ‘Momentum Traders’ by the home buyers who maintain they are the catalytic force behind the home prices shooting up to an unrealistic level; to the point where there is no co-relation of the per capita income of the given city and its housing price index.
The Indians across the country hence believe the idea of the Government of India to ensure housing for all by 2022, which means meeting shortage of 300 lakh houses in urban areas with an investment of $2 trillion, is laudable but not practical with the existing eco system.
They believe the real issue is not just about the investment but the intention that will define the roadmap of housing for all.
The Indians think instead of media hyperbole of big measures many of the small but practical measures can go a long way to ensure a house for each family, if not each individual. Some of the suggested measures may not make the government popular, and hence the Indians are not convinced with the promise of housing for all.
More than six out of ten, 64 per cent of the Indians blame the momentum traders to be responsible for the unaffordable home prices. Only around one-fourth, 24 per cent agree that the rising input costs are making the houses unaffordable in most of the Indians cities; while 12 per cent maintain a combination of both the reasons are responsible for the price of the apartment continuously moving up even when the transactions are pretty low.
These are the findings of Track2Realty survey that tried to capture the psyche of the home buyers on two different levels. The study tried to capture their perception of what is taking the housing prices unrealistically high even in the wake of the slow transactions in recent times.
On a parallel level, the survey also explored to find out whether the government’s promise of housing for all by 2022 is gaining ground in the collective consciousness. The idea has been to find the end-users perspective of what is wrong with the housing market and what measures they think can lead to the government’s desired goal of housing for all.
64% Indians blame momentum traders behind unaffordable houses
85% Indians feel mandatory one-person-one-house would make houses affordable
62% demand no Income Tax concessions to second home purchase
64% homebuyers reject government agencies in the role of developer
48% Indians feel ‘Housing for All’ is a populist idea than viable
58% feel vested political & bureaucratic interests in the housing market deterrent in reforms
Track2Realty conducted this survey in ten cities-Delhi, Mumbai, Kolkata, Bangalore, Chennai, Pune, Lucknow, Patna, Indore and Coimbatore. It was an attempt to capture the mood of the home buyers vis-à-vis the vision statement and policy rollout of the government.
With most of the survey questions been open ended the respondents were given opportunity to speak out their view point than just opt for one of the given answers. The results nevertheless clearly explain that the Indians are quite aware with the government policies in general and its impact over the housing market in particular. Most of the questions were revolving around the quest for a house and the reasons of not being able to have it.
On a broader level, the survey delved deeper to find out what could be an ideal housing market to keep these momentum traders out of the eco system; something that could lead to the realisation of the dream of housing for all.
A whopping 85 per cent of the home seekers in the country maintain that one person one house should be made mandatory, while the rest 15 per cent maintained investment in the second house should be discouraged through incentives for investment in other instruments.
Should the mandatory one person one house provision be only in the affordable segment or housing across the pyramid? Again, a whopping 72 per cent feel so long housing is a lucrative investment for the rich and wealthy people the developers would be more interested in luxury housing and not mass housing.
They therefore demand one person one house to be uniform policy. 18 per cent feel even the luxury housing project must have a fair share of affordable component, while the rest of 10 per cent respondents believe an institutional mechanism must be developed to make mass housing more lucrative for the developers.
One strong suggestion coming from a wide range of Indians who responded to the survey is that the government should stop encouraging income tax concessions to second home purchase. Six out of ten, 62 per cent feel uniform tax concession to end number of houses encourages speculation and adds to the number of unoccupied residential and commercial units.
26 per cent demand families purchasing a second home should at least pay a 40 percent down-payment. 12 per cent, on the contrary, feel that draconian laws are not solution to the housing shortage in the country.
What comes out as a sense of endorsement for the developers is the fact that a large number of Indians, as many as 64 per cent don’t think the government agencies (DDA, MHADA etc) can provide housing to all. Over one-fourth of the Indians, 26 per cent think the PPP (Public Private Partnership) model should be restructured to make mass housing attractive proposition while rest of 10 per cent are not sure about the solution.
Nearly five out of ten, 48 per cent feel housing for all is more of a populist idea than a viable solution. More than one-third, 35 per cent maintain that the intention is good but is not possible for the government and only 17 per cent think the government has just started taking all the right steps to fulfil the promise.
The moot point for the feasibility of ‘housing for all’ is the reforms in the housing market. However, majority of the Indians, 58 per cent maintain this will be difficult given the various vested political and bureaucratic interests who ensure that property prices remain artificially jacked up. 32 per cent blame it to the black money in the market, while 10 per cent blame it to both the reasons.
Track2Realty is an independent media group managed by a consortium of journalists. Starting as the first e-newspaper in the Indian real estate sector in 2011, the group has today evolved as a think-tank on the sector with specialized research reports and rating & ranking. We are editorially independent and free from commercial bias and/or influenced by investors or shareholders. Our editorial team has no clash of interest in practicing high quality journalism that is free, frank & fearless.
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