Affordable housing in Ahmedabad

In 2012, the estimated housing shortage in India was 18.78 million units. 88% of this shortage pertains to households with annual incomes of about Rs100,000 (USD 1,724) and another 11% for those with annual incomes of less than Rs200,000 (USD 3,450). Government of India has played a supporting role to house the poor through special programmes, targeted subsidy, and creation of an enabling environment for private sector initiatives. Post 1990, several reforms were introduced, and there was a gradual shift in the role of the Government from a ‘provider’ to a ‘facilitator’. The facilitating approach aims at fostering public-private partnerships through incentives for the private sector, promotion of housing finance institutions, use of alternative and environment-friendly building materials and technologies, and support to NGOs, CBOs and cooperatives. In this context, Ahmedabad - the fifth largest city in India with a population of 5,570,585 and seventh largest urban agglomeration with a population of 6,352,254 (Census 2011), offers an interesting perspective on affordable housing. Private developers implementing housing schemes for low income groups have learnt from experience that although initially there is a higher demand for two-room units, a majority of potential customers’ can afford only one-room units. Further, housing finance institutions have come-up with new products and have identified alternative means for assessing incomes and affordability of people in the informal sector. The strategies, processes and tools that private developers have introduced in Ahmedabad are contributing to increasing the stock of affordable housing.