This document discusses various approaches to providing affordable rental housing in India. It begins by defining different types of affordable housing such as ownership housing, social rented housing, and intermediate housing. It then discusses challenges around providing affordable housing given rapid urbanization and poverty levels in India. The document outlines several government initiatives and programs to promote affordable housing. It also examines issues around developing affordable housing and strategies to increase housing supply such as using government land banks and increasing floor space index. The document analyzes rental housing models and case studies from other countries and within India to provide affordable rental options.

1. AFFORDABLE RENTAL HOUSING
BY
USHA BATRA
Additional DG, CPWD, Mumbai

2. “HOME IS WHERE HEART IS”
“TO OWN A HOUSE is One’s BIRTH RIGHT”

3. TYPES OF AFFORDABLE HOUSING
• Affordable ownership
housing ; who can
afford to buy a house
for self.
• Social Rented housing;
from local authorities
or registered providers,
rented at lower rates
than market.
• Intermediate Housing;
Partly owned and
partly rented under the
shared ownership
schemes.

4. Creating solutions for providing affordablehousingto all is a
challenging enterprise

5. The World Bank, estimated that world had 872.3 million people
below the new poverty line, of which 179.6 million people lived in
India. In other words, India with 17.5% of total world's population,
had 20.6% share of world's poorest is in India (2013)
Hence, priority to provide affordable housing to the poor.

6. Definition of Affordable Housing – MHUPA (2011)
Source: Guidelines for Affordable Housing in Partnership (Amended), MHUPA, 2011
As per HUPA EWS are those with earning below Rs. 1,00,000 per
annum and LIG between Rs. 1,00,000 and Rs. 200,000 per annum

7. Urbanisation leading to Housing
Shortage in India
• As per 2011 census, 31.16% lived in urban areas.
• growing migration of people from rural to urban areas has led
to shortage of
 Land
 Housing
 Transport.
 Amenities like water, power and open spaces.
HENCE PROVIDING AFFORDABLE HOUSING BOTH
AT RURALAND URBAN AREA SIMULTANEOUSLY
MAY SLOW DOWN THE MIGRATION.

8. Basic requirement & affordability
• An affordable housing project should be
located within affordable travel distances
from a major workplace hub and should
be connected adequately through public
transport.
• Basic amenities like sanitation, adequate
water supply, power, parks, school &
health facility within project or
neighborhood.

9. LOCATION

10. The DDA had in September 2014
rolled out nearly 25,000 flats via a
lottery system in suburban areas
including Dwarka, Rohini and
Narela.
Nearly 8,400 allottees, have
surrendered their flats.
Reasons
location of flats
Insufficient built-up area

11. Housing Shortage in Urban India
Despite a housing shortage of approximately 19 million
units, around 11.09 million houses are vacant in urban
areas as per 2011 census data.
If these vacant houses are made available for rental
housing, then some shortage, could be addressed. But
main shortage in urban India is in EWS housing meant for
slum dwellers.

12.  Formulation of National Urban Housing & Habitat Policy
2007.
 Jawaharlal Nehru National Urban Renewal Mission.
 Interest Subsidy Scheme for Housing the Urban Poor.
 Affordable Housing in Partnership : Modification in
JNNURM
 Setting up of a High Power Task Force on Affordable
Housing.
 Launch of the Rajiv Awas Yojana
 Prime Minister Awas Yojana – Housing for all
Major Government Initiatives and Programmes for Affordable
Housing

13. ISSUES IN THE DEVELOPMENT OF AFFORDABLE
HOUSING
•
• Continued and rising population growth.
• Lack of availability of urban land, marketable land
parcels and rising costs of land / property and
construction.
• Lack of financial resources with the governments.
• Lack of access to home finance for EWS and LIG
• Regulatory constraints like lengthy approval and land
use conversion process, multiple statutory approval
requirements leading to cost escalation.
•

14. Mhupa DRAFT MODEL PROVISION FOR AMENDMENT TO
RESPECTIVE MUNICIPAL ACT(s)
PROVISION 1;
a. In all Town Planning Scheme or Development
scheme, there shall be reservation of not less
than 10% of the gross land area under each
scheme for the purpose of providing housing
accommodation to (EWS) and (LIG).
b. The size of the plot reserved for EWS and
LIG shall not be less than 30 sqm and 40 sqm
respectively and not exceed 48 sqm.

15. Mhupa DRAFT MODEL PROVISION contd…
PROVISION 2 & 3 WOULD APPLY, WHEREVER
PROVISION 1 IS NOT INCORPORATED
Provision 2: Plotted Development Scheme.
 In all plotted development schemes of area above one hectare
(10,000 sqm) not less then 10% of the gross land be earmarked
for EWS & LIG
 For land between 4000 to 10,000 sqm, either land may be
reserved for EWS & LIG or shelter fee as prescribed by the
appropriate government.
Provision 3: Group Housing Schemes.
 For 3000 sqm and above reservation to the extent of 15% of
permissible FAR or 35% of the total dwelling units, whichever is
higher shall be provided.

16. Mhupa DRAFT MODEL PROVISION contd…
• Inventory be maintained of all the plots or houses
for (EWS) and (LIG) and ensure its protection
from encroachment.
• Every developer of such scheme shall be
incentivized .
• Fund resourcing from non residential land
development / buildings above 1000 sqm .
which may be used for provision of land, housing,
basic service etc. to the urban poor.

17. Strategy for Increase Supply of affordable housing
• Use of Government land bank
• Additional FSI for construction of tenements of
specified size .i.e 30% EWS, 30% LIG, 30%MIG &
10% as per choice of developer.
• Inclusive Housing in all Housing Projects by
mandating 20% of built-up area for EWS & LIG
• Reviving PPP scheme for Rental Housing at strategic
locations.
• Strategy for optimum use of existing land resource by
encouraging REDEVELOPMENT

18. INCREASING FSI
• Possibility to explore 4 FSI as per master plan or development plan ?
• Density max. permitted for units with area upto 40 sq. m 500 + 10% =
550 DUs per Hactare
• Plot area= 1 ha.=10000sq.m.
• Total built up area with 4 FSI= 40000 sq.m.
• Area for amenities @ 7.0sq. m. / personfor each unit=7x4.5= 31.5 sq.m.
• Unit area=25 sq.m. units.
• Usable total area as / density=
550x(25+7x4.5=56.5)= 31075 sq.m. i.e. 3.1 ha. Out of 4 ha.
• Max. usable plot area for 40 sq.m. units.
550x(40+7x4.5=71.5)= 39325 sq.m. i.e. 3.93 ha.
4 FSI can be consumed only if unit area is 40 sq.m. whereas max.
requirement is for EWS with unit area of 25 sq.m.
AS/ NORMS OF DENSITY & AMENITIES ONLY 3 FSI CAN BE
CONSUMED FOR EWS HOUSING & 3.9 , IF ONLY LIG PROVIDED
HOW FSI OF 4 CAN HELP UNLESS NORMS REVISED ?
SEEN IN CASE OF DHARAVI…….NO BIDDERS

19. Rental housing
• Rental housing can be simply defined as a property owned by an
individual or by a legal entity, for which the resident pays a monthly rent
to the owner. It is simply a formal or informal contract between the
tenant and the landlord to rent the dwelling for a certain period of time at
a predetermined price.
• Rental housing lessens the burden on a migrant to invest till one can own
for varying durations of stay whether in search of employment or
education.
• As per Census 2011, over 27% of urban residents of the country are
living on rent and most of them are informal in nature. The NSSO report
has highlighted that, 25% of the hired dwelling units are informal and
only 5% are formal.
• As all the States in India are governed by their respective Rent Control
Acts (RCA) which is skewed towards tenant protection, a fixed rent with
limited options to increase rentals etc. has resulted in rental housing
being economically unattractive and thereby creating an informal market.

20. Models on Rental Housing
RENTAL HOUSING FOR THE PROSPECTIVE
MIGRANTS/HOMELESS:
There is a need to create sufficient number of rental
accommodation for homeless and destitute & for migrants who
cannot afford to buy a house initially.
State government along with the ULBs / pvt. Sector may
construct rental houses of
 various sizes for families
 hostels/dormitories for single persons
 These can be given on rent up to a certain time on a short to long
term basis.
 thereafter occupants are expected to move to their own houses
 except for homeless, destitute, aged people and people with
special needs .

21. Models on Rental Housing contd…
RENT TO OWN SCHEME;
• Ultimate goal is to favor homeownership, to benefit the poor who
can’t afford to buy a house.
• Initial allotment of the unit is done on lease basis for a fixed number
of years.
• Buyer deposits the monthly rent / EMI in bank account.
• The EMI contains a certain percentage of rent and rest as thrift.
• When EMI amount reaches certain percentage (i.e.10%) of total unit
price, property will be hypothecated to bank and government.
• In case of non-payment of EMI, bank and government will resell
property.
• Thrift amount returned to buyer without interest.
• On 100% payment, property papers are handed over to the buyer by
de-hypothecation.

22. Models on Rental Housing c0ntd…..
• CONVERTING SLUMS ON ULB LAND TO
RENTAL HOUSING;
• Nearly 60% of slums across urban India are on
government owned lands, in which 40% are on lands that
belong to Urban Local Bodies (ULBs) –municipalities,
municipal corporations, town panchayats, municipal
councils,
• Slums occupying ULB land can be converted to rental
housing.
• ULB can give a “no eviction guarantee” to the household
for 10 years or more, and gain rent revenue from the
household in exchange for the utilization of the ULB land.
• Such scheme in Ahmadabad have given good revenue for
the ULB.
• This model could generate between 15 and 25 % of the
ULBs’ revenue

23. AFFORDABILITY OF RENT TO OWN
• Low income Group 40% population
• Annual income Rs. 2,00,000/-
• Monthly income Rs. 16,667/-
• Affordability @ 30%for EMI / Rent = 5000/-
can own a house of 25 sq.m. area in 8-9 years considering the
cost of const. 20,000/- per sq.m. giving cost of flat= Rs. 5 lac
 If Interest free loan given by Govt.& common areas and
services are developed and maintained by Govt.
 LIG house can be owned after renting in 8-9 years,
 EWS in 16-18 years
as his annual income is 50% of LIG
 Govt. to explore such schemes for eradication of SLUMS

24. RENTAL HOUSING POLICY
• Earlier government planned to club rental housing policy with
Housing for All scheme. Later, decided to launch the scheme
separately.
 Ministry of Housing and Poverty Alleviation will provide 75 %
of the construction cost of rental units .
 25 % to be borne by states, urban local bodies and NGOs .
 Dormitories for singles / migrant labour.
 Rental units 300 sq feet area in case of families.
 To be vacated within five years by which time migrants were
expected to buy their own home or rent one at market rate.
 However, vacation not applicable for destitute and homeless
populations.
 On pilot basis, the project is expected to be implemented in Delhi
before it will be implemented in other cities.
• Wednesday 04 May 2016

25. UNITED STATES OF AMERICA; CANADA ;
• Choice Vouchers programme allowing tenants to seek their
own housing from private landlords, rather than confining
low-income tenants to public housing ghettos. Voucher
program (originally called certificates) aimed at low-income
rental housing as part of their federal housing policy.
Recipients choose a house or apartment available in the private
market and contribute roughly 30% of their incomes toward
rent, with the program paying the difference up to l voucher;
they are responsible for finding a house or apartment that
meets the program standards with a landlord who is willing to
participate in the program. Subsidy is paid to the landlord
directly by the public housing agency.
CASE STUDIES OF OTHER COUNTRIES

26. CASE STUDIES OF OTHER COUNTRIES
AUSTRALIA;
• The Government launched National Rental
Affordability scheme (NRAS) to help increase the
supply of affordable rental dwellings by up to 50,000
by 2012, with a further 50,000 to be made available
post July 2012 subject to demand. Rent for these
properties was to be charged at 20% below the market
rate for eligible tenant. Australian Government
provided funding to increase the supply of affordable
rental dwellings .
• Comments / suggestions for USA, & Australia
Capping will be reqd. for different categories as
anything more than 30% is to be born by Govt.
Feasible only where combination of proximity to
working place & availability of low rental areas exists.

27. CASE STUDIES OF OTHER COUNTRIES contd…
IRELAND
• This scheme enables the purchase of a new or a second-hand
home on the open market with the local authority or the not-
for-profit housing agency initially taking at least 40% stake,
which they rent to the beneficiaries. The individual funds their
equity stake through a local authority loan and committed to
take out all the equity in the property over 25 years. They
make payments on a mortgage for the part they own and pay
rent to the local authority for the other part. Irish housing
policy also aims to enhance the role of private rental sector by
reforming tenancy legislation.
Comments / suggestions
• Rent and own. May not be possible for slum dwellers and
EWS/LIG in India due to very low income. Secondly,
acceptability of inclusive housing is a must for implementation

28. CASE STUDIES OF OTHER COUNTRIES contd
CHINA
• The Chinese government provides old flats on rental at a very
low price and called 'low-rent housing’. Another scheme is
PRH scheme which is the first attempt to use non-ownership
housing to solve the housing problem of people, mainly who
have low income.
China has introduced a series of tax exemptions and higher FSI
for developers of public rental-housing projects.
Comments / suggestions
• Is possible in India. Govt. of India is also thinking on these
lines as 11 million houses lying vacant. Can help in removing
slums but is only a temporary solution. Moreover maintenance
of services & common areas to be taken care by Govt. Possible
only for vacant EWS / LIG housing which may not be
available.

29. INDIAN CASE STUDIES, mumbai
• Model 1: Higher FSI up to 4.00 with
TDR application on Private Land: Of
the total 4.00 FSI granted 3.00 FSI will
be used for the rental housing; however
TDR will be applicable for the non
utilized balance FSI.
• Model 2: Higher FSI up to 4.00 with
no TDR application on Private Land:
Of the total 4.00 FSI granted, only 1.00
will be utilized for rental housing;
however TDR transfer benefits will not
be available to the developer.
• Model 3: Higher FSI up to 4.00 on
MMRDA (Government land): Of the
total 4.00 FSI granted, 3.00 will be
utilized for rental housing while the
remaining 1.00 will be utilized for
commercial development.
MMRDA RECEIVED GOOD
RESPONSE FOR THE SCHEME
Rental housing project is profitable generally on a larger piece of
land with proximity to various amenities and transport .

31. comments/ suggestions
• Model 1 ; Usability of FSI 3 to be ascertained with minor
change or relaxation of norms . Applicability of TDR on
balance FSI is beneficial for the developer to earn revenue for
subsidising rental housing. More no. of rental housing units
will be obtained.
• Model 2 ; More beneficial for developer in respect of use of
FSI 4 as he has to build only ¼ area for lower category & ¾
area for construction of higher category of houses. Less no. of
rental housing units will be obtained ( 1/3 of Model 1)
• Model 3 ; Usability of FSI 3 to be ascertained with minor
change or relaxation of norms . Commercial area in ¼ of plot
will benefit the occupants of rental housing as well as the
Govt. to earn revenue for subsidising more no. of rental
housing units.

32. Aarusha Homes
• Aarusha Homes is a registered private company that provides rental
housing solutions to low and middle income group customers for short
term stays through formal hostels and paying guest accommodation .
Mainly operating in south India.
• One of the few operators who are registered as a private company and
manage rental housing formally.
• Properties are acquired from land owners on a lease period of 3-9 years,
located in close proximity to the tenant’s place of work / study.
• Landlords and builders are consulted well in advance to achieve and
execute a mutually agreed design and layout plan.
• 95-100 sq. ft area includes room, kitchen, toilet and other common
spaces, security deposit of Rs. 1,000 and Rs. 3,000-6,000 monthly rent
that includes Services like meals, property maintenance, laundry service,
internet and hot water supply and Rs. 1,400-2,400 excluding meals.
• The company does not face any defaulters.

34. comments/ suggestions
• It is the most suitable model for single persons ,
working or students, as it provides facilities like
meals, property maintenance, laundry service,
internet and hot water supply in addition to
affordable rent.
• The fact that the company does not face any
defaulters proves it is a successful model.
• Govt. must promote it & also think about
financing to some extent for its survival.
• can also be developed as hostels for back packers
and tourists on short stays.

35. Case Study of Chandigarh
• 1st scheme in India based on rent-to-own concept , to achieve slum free
city of Chandigarh by CHB in NOV. 2006
• Developed 25,728 dwelling units in G+3 storey building . Government
offered land free of cost (370 acres) at eight different locations about 1-
10 km away from beneficiary’s existing location of residence.
• Total project cost -10,215 million with two typical units of size of 270
sq. ft. and 370 sq ft.
• CHB managed to shift over 700 families from a slum site (Madrasi
Colony) to Sector 56 within few days,
• Beneficiaries were shifted to transit shelters prior to allotment at
monthly license fee of Rs. 600 per month and Rs 800 per month
After the allotment, beneficiaries to maintain their
individual units only. Maintenance of common
areas and resources along with overall
maintenance of the blocks is shouldered by the
CHB for first five years and thereafter by the
Municipal Corporation.

36. Implemented
seamlessly
because of
support of local
leaders and
political
willingness of
Chandigarh
Housing Board
Model can be repeated in many other cities with suitable modifications
to develop, that suit different types of cities for eradication of slums.
Sector-49C-Occupied Rental Flats Flats ready for allotment
Comments /
SUGGESTIONS

37. CASE STUDY OF RAJKOT
• Rajkot has about 3,000 small and medium scale
industrial units.
• migrants are the main users of rental housing.
• Types of Rental Housing in Rajkot are single room
tenements , part of house given on rent , full house
given on rent
 Households who can afford to build more than they
require.
 Households who have migrated out of the city and
purchased own homes give out part of the house on
rent to earn extra income to support family income.
 Free land is encroached upon to build not just self-help
housing but also rental housing.

38. Comments / SUGGESTIONS
• Existing Rental housing appears to be
unorganized, whereas being industrial
area many migrants are expected, more
organised rental housing needs to be
provided.
• Encroachment of vacant land by public
for own house / rental housing needs to
be addressed properly.

39. CONCLUSIONS
• Rental housing project is profitable generally on a larger
piece of land with proximity to various amenities and
transport .
• New rental law favoring both the tenant and the land-
lord needs to be drafted.
• Rental housing may be successful with
 inclusionary approach.
 sufficient land availability.
 sufficient incentives to the developers .
• Rent to own scheme is the solution to the problem of
affordable housing as well as eradication of slums.

40. CONCLUSIONS
• For making rent to own affordable for EWS, it is
proposed to construct independent room only, with
common toilet and common kitchen.
• Schemes like Aarusha homes to be promoted for
migratory working employees.
• Converting slums on ULB land to rental housing could
generate between 15 and 25 % of the ULBs’ revenue &
will be useful for temporary migrants..
• Regulatory constraints to be reformed to enable fast
approvals.
• Last but not the least is the support of local leaders &
political will, without which success is not feasible,
live example being CHB scheme.

41. THANK YOU