Poor financing leaves 70 million Indians without houses

No access to mortgages, market shortcomings in home financing to blame, bank says

GN Bureau | October 9, 2010




India is growing economically but Indians face shortage of housing, says a report released by the World Bank.

“In India alone, estimates of the housing shortage range from 20 million to 70 million yet as much as half of this excess demand can be profitably serviced by the housing and housing finance markets,” says the report released in Washington DC.

The report titled “Expanding Housing Finance to the Underserved South Asia” mentioned many people in the South Asia live in crowded conditions.

According to the report, “One in every 4 people on the planet live in the South Asia region, and more than 14 percent of South Asians have no home, not counting a further 45 percent living in overcrowded conditions.”

The report noted the lack of access to mortgages and shortcomings of the market for home financing in the region.

“Around 30 million middle - and lower - class households in South Asia — which accounts for 11 percent of the region’s population — have the willingness to pay, but unable to have access to mortgages.”

The report examined situation of the five countries in the South Asia Region: Afghanistan, Bangladesh, India, Pakistan, and Sri Lanka.

“Public-sector housing provisions alone cannot cope with the demographic and urbanization pressures of low-income groups,” said the report while mentioning need for the private players in this sector. 

The Washington based Bank also found that housing finance markets in the South Asia have grown at an impressive 30 percent rate in the past decade, but are limited to upper-income groups.

“There is a shortage of more than 38 million housing units in the region, taking into account average household size, this translates to 212.5 million homeless people, 14 percent of a total population of 1.5 billion.” said Ernesto May, the World Bank sector director for poverty reduction and economics management.

The World Bank suggested building affordable housing on low income solutions.

“In some countries such as India, this shift is already afoot. In India, it may be commercially viable to build housing for 23–28 million households (35–45 percent of urban India) whose monthly household incomes are in the range of Rs. 5,000–11,000,” said the report.

“Easing access to housing finance for low-income, rural, and informal population groups is the key that will open the door to the solution,” added Ivan Rossignol, sector manager for private and financial sector development in South Asia.

Last month international consultancy firm Ernst and Young said in its report that India will face shortage of over 26 million houses by 2012.

Read the report

Comments

 

Other News

How social media is reshaping elections

Since Brazil’s return to direct presidential elections in 1985, no candidate who finished second in the first round of polling had ever won the presidency. Luiz Inácio Lula da Silva, now 81, has just done it. What explains the comeback, and what changed in Brazilian politics to make it possi

Cabinet approves Dearness Allowance, Dearness Relief

The union cabinet chaired by prime minister Narendra Modi on Wednesday approved the release of an additional instalment of Dearness Allowance (DA) to central government employees and Dearness Relief (DR) to pensioners with effect from 01.07.2026 representing an increase of 3% over the existing rates of 6

Cyclone Arnab strikes Andhra as warming oceans amplify storm risks

Cyclone Arnab made landfall along the Andhra Pradesh and Yanam coasts in the early hours of Wednesday as a very severe cyclonic storm, with maximum sustained wind speeds of 125–135 kmph and gusts reaching 150 kmph. Its rapid intensification has raised concerns about how warmer oceans, global warmin

Counting matters but which ones?

The first instinct of public policy is to count. Its harder task is to count what counts. We have become remarkably good at measuring the reach of the welfare state vis-à-vis beneficiaries covered, rupees transferred, houses built, connections installed and services delivered. But some of the most

Inching closer to a trade deal with America

The cooperation between India and the United States goes back quite a time. We need to relegate that era to the backburner when Pandit Jawaharlal Nehru visited US in the times of president Dwight Eisenhower and called the American let-off of 10 million dollars in defence aid to Pakistan as a “gun w

Manch vs Musk: Forty people and a foreign billionaire

About forty people walked the roundabout on Teen Murti Marg to the gate of Chanakyapuri police station, a distance you could cover in under a minute, on Friday to protest against Elon Musk’s Starlink. The walk was called by the Swadeshi Jagaran Manch. Nobody joined them on the way, and nobody seeme

Upcoming Conferences



-->

Archives

Current Issue

Opinion

Facebook Twitter Google Plus Linkedin Subscribe Newsletter

Twitter