In view of the government agencies' failure to cope with the increasing demand for housing, the proposed policy, in a draft stage now, is believed to be paving the way for a greater private role in housing projects.
It may recommend that the private building industry and cooperative societies be given preference in allotment of land and residential sites for group housing projects.
Most in the industry feel that the policy could be the answer to the long-standing need to give more freedom to private players to plug the demand and supply gap.
"It is a fact that all government bodies and agencies have failed miserably to maintain a healthy demand-supply ratio. Lack of focus on their part and decades old technology has hit the housing sector hard," said Raheja Developers managing director Naveen M Raheja.
The industry is also unanimous that the proposal, if approved, will benefit the consumers by ensuring availability of quality housing. "It is a positive development and will be beneficial to everybody. Gurgaon is a good example of what private players can do in the housing sector. People will have greater options and better quality," said Vijay Vancheswar, vice-president, DLF Universal.
However ensuring availability of land remains one of the problem areas and the industry is hoping that the final draft of the policy would address the issue. "Unlocking land and making it available will be one of the biggest challenges but something has to be done or it will all come to a nought," said Vancheswar.
Many are in favour of removing the Urban Land Ceiling Act altogether. "Agricultural land in urban areas serve no purpose and if the supply is to be increased, the Act has to go and land released," Raheja said.
The proposed policy is also believed to be leaning towards reserving a part of the housing projects for the weaker sections of society.
Vancheswar said the government should earmark certain areas for housing for the weaker sections and sell them at subsidised rates. "Housing for the weaker sections will fall flat if certain incentives are not given to the industry," he said.
Vatika Group vice president, marketing and business development, Pankaj Pal was a little sceptical as to how the policy would be implemented.
"Simply opening up the sector for the private players to troop in will make land acquisition very messy. The Delhi Development Authority should step in and acquire the land and auction it to private players," he said.
Raheja also stressed a need for checks and balances. "Housing for the masses has to be taken care of and certain by-laws should be formulated for that. Further caps should be enforced while giving licences and certain quality standards should be identified as a yardstick," he added.
Expected proposals in the Housing and Habitat Policy 2005
- Encourage public-private partnership; more freedom to private sector
- Private building industry and co-operative agencies to get preference in land allotment
- Private players to reserve a part of the projects for lower income group
- Reduction in stamp duty on residential property to 2-3 per cent in all states
- Strengthening of foreclosure laws
