In an effort to rejuvenate the affordable housing sector, the Haryana government has approved a significant increase in the allotment rate of affordable housing units. The rates in Gurugram, Faridabad, Panchkula, Pinjore-Kalka have been raised from Rs 4,200 per sq ft to Rs 5,000 per sq ft, marking an average increase of 20%. This move has been well received by developers who believe that it will contribute to the growth of the affordable housing sector by stimulating fresh supply and attracting more investment.

Signature Global, which is one of the prominent developers with substantial focus on affordable housing, agrees that the higher rates would encourage developers to undertake more affordable housing projects, increasing the supply of affordable homes. This development brings positivity to the sector and ensures that homebuyers have access to quality housing options. The amendment is proof of the government’s dedication to promoting affordable housing and meeting people’s housing needs.

“We applaud the recent amendment in the Affordable Housing Policy-2013 by the Haryana government, which is a game changer for the sector. The increase in rates for hyper and high potential zones like Gurugram, Faridabad, Panchkula by ₹800 per sq ft on the carpet area makes affordable housing projects more viable for developers. This showcases the government’s commitment to addressing the housing need and creating a win-win situation for all stakeholders,” said Pradeep Aggarwal, Founder & Chairman, Signature Global (India) Ltd.

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Several other developers have similar views. “It is indeed a welcome step by the Haryana government to increase allotment rates on an average by 20 per cent. The decision is likely to make affordable housing viable for developers and go a long way in fulfilling the dream of people of owning a dream home,” said Avneet Soni, President, Omaxe Ltd.

The Affordable Housing Policy, implemented on August 19, 2013, aims to promote the development of ‘Group Housing Projects’ that offer apartments of a predetermined size at predetermined rates within a specified time-frame. This policy is designed to boost the supply of affordable housing in the urban housing market and benefit deserving beneficiaries.

In light of the significant rise in construction costs over the past few years, developers have been advocating for a revision in the per-square feet rate to ensure the viability of the affordable housing projects for development. The 20% increase in the selling rate will provide much-needed relief to real estate developers.

“The cost of construction is going up significantly, the margins in the affordable housing segment are thin and hence, not many developers are coming forward to launch new projects. With the revision in the allotment rate by Rs 800 per sq. ft. and that of balcony by Rs 200 per sq. ft., the viability of affordable projects will improve. It will help attract more developers and also help the Govt in achieving the ‘Housing for All’ initiative,” said a spokesperson of Faridabad-based Adore Realtech Pvt Ltd.

“The aim of the ‘Affordable Housing Policy’ of the government is to ensure affordable housing for all. The scheme has helped millions of people buy their dream homes. However, due to the rising land prices as well as a substantial increase in key raw material prices, including steel and cement, developers were reluctant to take up new affordable housing projects and hence, there was a long-standing demand to increase the allotment rates for the apartment units under ‘Affordable Group Housing’ projects across the state of Haryana,” said Soni.

In addition to increasing the per sq. ft. price of the carpet area, the government has also decided to hike the rate of balconies by Rs 200 per sq. ft. to Rs 1,200 per sq. ft. This adjustment allows developers to recover the necessary construction costs by increasing the rate of balconies.