NTCC PROJECT WORK ON

Housing sector of India

Made by: Kandarp Bajaj
Enrollment no.: A13567214036
BBA-CM

We hereby declare that this project report entitled

Indian Housing Sector Analysis

is written by us and submitted to RICS SCHOOL OF BUILT ENVIORMENT,

is a record of an original work done by us under the guidance of
Mr.Nihar Nanyam.

ACKNOWLEDGEMENT
We are highly indebted to Prof. Nihar Nanyam for showing faith on us and
giving us an opportunity to make this report. He has been actively involved
right from the concept plan, draft and final report preparation. His timely inputs
and critical observation of the work helped us to improve our report.
Due credits to our parents, almighty God & peers for their timely help, support
and cooperation during this learning journey.

Table of content

Analyst View
Research Overview
Market Attractions
Residential Real Estate Industry Outlook to 2013
Overview
Market Structure
Housing Units
Number of Rooms
Flat and Independent Houses
Type of Ownership
Housing Demand Analysis
Affordable Housing
Current Demand Potentials
Latest Developments
Medium Housing
Luxury Housing
Current Demand Potentials
Latest Developments
City Level Analysis
Housing Deficit
By States
Housing Finance
Home Loan Demand
Mortgage Rates

List of Figures:
Figure 3-1: Real GDP Growth (%), 2010-2014
Figure 3-2: Population (Billion), 2009-2014
Figure 3-3: Urban Population (Million), 2009-2014
Figure 3-4: Average Family Size per Household (1990, 1995 & 2010)
Figure 4-1: Housing Market Potential (Billion US$), 2012-2014
Figure 4-2: Share of Housing Sector in Real Estate Industry (2005 & 2010)
Figure 4-3: Housing Sector Contribution to GDP (%), 2008 & 2013
Figure 4-4: Household by Number of Rooms (%), 2001 & 2008
Figure 4-5: Forecast for Household Demand by Number of Rooms (%), 2013
Figure 4-6: Share of Flat and Independent Houses in Rural Region (2003 &
2008)
Figure 4-7: Share of Flat and Independent Houses in Urban Region (2003 &
2008)
Figure 4-8: Share of Owned and Hired Houses in Urban and Rural Region
(2004)
Figure 5-1: Housing Demand Potential (Million Units), 2012-2014
Figure 5-2: Housing Unit Sales Potential in Volume by Segment (%), 20122014
Figure 5-3: Housing Unit Sales Potential in Value by Segment (%), 2012-2014
Figure 5-4: Affordable Housing Demand Potential (Million Units), 2012-2014
Figure 5-5: Affordable Housing Market Potential (Billion US$), 2012-2014
Figure 5-6: Medium Housing Demand Potential (Million Units), 2012-2014
Figure 5-7: Medium Housing Market Potential (Billion US$), 2012-2014
Figure 5-8: Luxury Housing Demand Potential (Million Units), 2012-2014
Figure 5-9: Luxury Housing Market Potential (Billion US$), 2012-2014
Figure 6-1: Mumbai - Housing Supply (Units), 2009-2011
Figure 6-2: Mumbai - Distribution of Housing Supply by Location (%), 2009 to
2011
Figure 6-3: NCR - Housing Supply (Units), 2009-2011
Figure 6-4: NCR - Distribution of Housing Supply by Location (%), 2009 to
2011
Figure 6-5: Bengaluru - Housing Supply (Units), 2009-2011
Figure 6-6: Bengaluru - Distribution of Housing Supply by Location (%), 2009
to 2011
Figure 6-7: Chennai - Housing Supply (Units), 2009-2011
Figure 6-8: Chennai - Distribution of Housing Supply by Location (%), 2009 to
2011
Figure 6-9: Kolkata - Housing Supply (Units), 2009-2011
Figure 6-10: Kolkata - Distribution of Housing Supply by Location (%), 2009 to
2011
Figure 7-1: Faucet Market (Billion INR), 2010-2014

Figure 7-2: Tiles Industry Revenue (Billion INR), 2007-08 to 2011-12

Figure 7-3: Tile Industry by Type (%), 2009-10 & 2011-12
Figure 7-4: Electrical Switch Market (Million US$), 2010-2014
Figure 7-5: Cement Consumption (Million Metric Tons), 2008-09 to 2013-14
Figure 7-6: Finished Steel Consumption (Million Metric Tons), 2008-09 to
2010-11
Figure 7-7: Steel Consumption by Major Sectors (%), 2010-11
Figure 7-8: Paint Industry (Billion INR), 2010-2014
Figure 7-9: Paint Industry by Segment (%), 2011
Figure 7-10: Paint Industry Revenue by Type of Paint (%), 2009-10
Figure 7-11: Bathroom Fittings Market (Billion INR), 2010-2014
Figure 7-12: Furniture and Furnishing Market (Billion INR), 2010 & 2015
Figure 7-13: Furniture Industry by Consumer Segment (%), 2010
Figure 7-14: Organized Wooden Flooring Market (Billion INR), 2011 & 2014
Figure 7-15: Laminate Flooring Market (Billion INR), 2011 & 2014
Figure 7-16: Modular Kitchen Market (Million US$), 2011 & 2014
Figure 8-1: Pre-engineered Buildings Industry (Billion US$), 2010, 2012 &
2014
Figure 9-1: FDI Inflows in Real Estate and Housing Sector (Billion INR), 20082010
Figure 9-2: Number of Announced PE Deals in Residential Sector (2008-2011)
Figure 10-1: Housing Credit as a Percentage of GDP (2006-07 to 2010-11)
Figure 11-1: Share of Factors Influencing Purchase of a House
Figure 12-1: Share of Factors Important to Builders
Figure 13-1: Senior Citizen Population (Million), 2009-2014
Figure 14-1: Lending Interest Rates (%), 2010-2014
List of Tables:
Table 3-1: Population Breakup by Age Group (%), 2009-2014
Table 4-1: Number of Occupied Residential Houses in Urban and Rural Region
by State (2001)
Table 4-2: Share of Flat and Independent Houses in Urban and Rural Region by
State
Table 4-3: Share of Owned and Hired Houses in Urban and Rural Region by
State
Table 6-1: Mumbai - Major Residential Projects Launch
Table 6-2: Gurgaon - Major Residential Projects Launch
Table 6-3: Noida - Major Residential Projects Launch
Table 6-4: Bengaluru - Major Residential Projects Launch
Table 6-5: Chennai - Major Residential Projects Launch
Table 6-6: Kolkata - Major Residential Projects Launch
Table 8-1: Top 10 Existing and Upcoming Residential Projects with IGBC

Green Homes
Table 10-1: Housing Loan Outstanding by Type of Financer (Billion INR),
2007-08 to 2010-11
Table 13-1: Senior Living Demand Distribution of Urban Households by Tier
Cities
Table 13-2: Senior Living Demand Distribution of Urban Households by
Region
Table 14-1: Demand and Supply of Core Professionals (000), 2010, 2015 &
2020

INTRODUCTION
India is blessed with one of the fastest growing real estate markets in the world.
It
is not only attracting domestic real estate developers but also the foreign
investors; particularly, the NRI investments in India have a bulk of their share in
the Indian housing market. The housing construction industry is poised for
double-digit growth in the backdrop of large population base, rising income
level
and rapid urbanization in search of employment. Moreover, the housing
construction industry is expected to overtake other industrial sectors in terms of
contribution to GDP growth in the next few years.
Presently, the affordable housing, basically targeted at economically weaker
class and low income groups, constitutes the majority of the Indian housing
industry, both terms of value and volume. However, medium and luxury
housing
is expected to witness significant growth in coming years as this market
segment
is comparatively very small and has huge potential for further developments. As
far as super luxury housing segment is concerned, latest industry trends and
developments are skewed towards the segment. MNCs have again began hiring
expat employees who are provided with the luxury housing benefits.
Additionally,
high net worth NRIs are also propelling demand for luxury housing in the
country.
Both these factors are expected to sustain the growth of luxury housing segment
in long run.
RNCOS report Indian Housing Sector Analysis provides exhaustive
information and objective analysis on the growing housing industry in India, its
components and supporting financing structure. The report also discusses the
market structure, current and past market performance and factors critical to the
success of the housing industry in India. Detailed data and rational analysis help
investors, financial service providers and global banking players to navigate
through the latest trends in the Indian housing industry.
The forecast given in the report is based on the correlation between past market
growth and growth in base drivers, such as household size, disposable personal
income, GDP growth, long-term interest rates, competitive structure,
government
support, contribution by housing finance industry and growing industrialization.

Housing in India varies greatly and reflects the socio-economic mix of its vast
population.
Housing varies from palaces of erstwhile maharajas in Rajasthan to modern
apartment buildings in big cities to tiny huts in far-flung villages. There has
been tremendous growth in India's housing sector as incomes have risen.
There are certain unique characteristics of Indian culture which often influence
how Indian homes are organised. A common traditional structure is for the
extended family to live in the same house, forming what is known in India as
a joint family For instance grandparents, their sons, daughters-in-law and
grandchildren live in the same household sharing the same kitchen. Brothers,
sisters and cousins grow up together. Each husband-wife combination has their
own bedroom. The eldest woman in the house is generally incharge of cooking.
In joint families, women live with their in-laws after marriage.
With modernisation there is a growing number of nuclear families, in which
each couple occupies its own house after marriage, in urban areas. It is still rare,
albeit not impossible, amongst traditional communities for senior citizens to live
alone. It is extremely rare even in urban areas for couples to live together before
marriage. Some single young adults live in same-sex dormitories or in shared
accommodation during college and the early working years.
The life-style in villages takes advantage of the warm weather. Many families
bathe outdoors in rivers and ponds. Most of the day is spent outdoors around or
near the house. Cooking is conducted outdoors in earthen stoves powered by
organic fuels or in modernkerosene stoves. Water is obtained from hand-drawn
wells. Men perform their ablutions in designated spots throughout the day;
Visitors to villages may find residents squatting down for an afternoon card
game under trees or while sitting on charpois (traditional hand-made beds)
brought outside during the day. Consequently they use their indoor space
primarily to sleep, change and, in electrified homes, to watch TV.

Low income housing

According to the Times of India, "a majority of Indians have per capita space
equivalent to or less than a 10 feet x 10 feet room for their living, sleeping,
cooking, washing and toilet needs." The average is 103 sq ft per person in rural
areas and 117 sq ft per person in urban areas.
44 percent of rural households have access to electricity. Although cities have
better facilities than villages, except for the major metros, no city in India
provides full-day water supply.

States such as Gujarat, Madhya Pradesh and others provides continuous power
supply. Some 400 million Indians do not have access to a proper toilet and the
situation is even worse in slums across Indian cities.
Funding
The national and state governments are running programs, some funded by the
World Bank, to improve conditions. Bharat Nirman is targeting clean water,
the Jawaharlal Nehru Urban Renewal Mission is building public toilets and
sewage systems. The private sector, including companies such as Tata, have
started to enter the low-income residential projects.

Mumbai

The Imperial Towers,Mumbai are the tallest buildings in India.

Mumbai experiences similar urbanisation challenges as other fast growing cities
in developing countries: wide disparities in housing between the affluent,
middle-income and low-income segments of the population.
Highly desirable neighbourhoods such as Colaba, Malabar Hill, Marine
Drive, Bandra and Juhu house professionals, industrialists, Bollywood movie
stars and expatriates. Up-scale flats have 3 or more bedrooms, ocean views,
tasteful interior decoration, parking for luxury cars and sleeping quarters for
maids and cooks. Only a tiny fraction of people in Mumbai live in these luxury
high-rises. In 2007, Mumbai condominiums were the priciest in the developing
world at around US$9,000 to US$10,200 per square metre. Mumbai has more
than 1,500 high rise buildings, many of which are just planned, but some
already constructed or under construction.
Despite the recent economic growth, there is still vast poverty, unemployment
and therefore poor housing conditions for a huge section of the population. With
available space at a premium, working-class Mumbai residents often reside in

cramped and poor quality, yet relatively expensive housing, usually far from
workplaces. Despite this, Mumbai's economic boom continues to attract
migrants in search of opportunities from across the country. The number of
migrants to Mumbai from outside Maharashtra during the 19912001 decade
was 1.12 million, which amounted to 54.8% of the net addition to the
population of Mumbai.
Over 9 million people, over 60% of the population of Mumbai, live in informal
housing or slums, yet they cover only 68% of the city's land area. Slum growth
rate in Mumbai is greater than the general urban growth rate. Financial Times
writes that "Dharavi is the grand panjandrum of the Mumbai slums". Dharavi,
Asia's second largest slum is located in central Mumbai and houses over 1
million people. Slums are a growing tourist attraction in Mumbai.
Most of the remaining live in chawls and on footpaths. Chawls are a
quintessentially Mumbai phenomenon of multi-storied terrible quality
tenements, typically a bit higher quality than slums. 80 per cent of chawls have
only one room. Pavement dwellers refers to Mumbai dwellings built on the
footpaths/pavements of city streets.
With rising incomes, many residents of slums and chawls now have modern
amenities such as mobile phones, access to electricity, often illegally, and
television.
Rent control laws have helped to create a housing shortage.
Delhi
Delhi has witnessed rapid suburban growth over the past decade. South
Delhi, Gurgaon and Noida have added thousands of apartment buildings,
houses, shopping centres and highways. New Delhi's famous Lutyens
bungalows house the prime minister, members of his cabinet, top political and
government leaders, military officials, senior judges and top bureaucrats. New
Delhi is also home to thousands of diplomatic staff of foreign countries and the
United Nations. With India's growth, Delhi has developed into a business
centre, especially for outsourcing, IT consultancy, high-tech, research,
education and health care services. Employees of these institutions are the
source of growing demand for high-end housing provided by major builders
such as DLF.
Roughly 18.7% of Delhi's population lives in slums, according to 2001
government statistics.

We are looking at the Housing Scenario at a stag when the National Economy is
on the road to revival, after reeling under depressive conditions for over the last
three years. The growth rate of the economy might go up to levels up to 6%, if
the revival is kept up. Share markets are not entirely looking up, though they are
stabilizing at levels which can be termed as reasonable. Industrial growth rate
which was wallowing at a low of 1.5% is now at around 5%. In fact, industrial
credit given out by banks which in normal times would be about 4-5 times of
bank credit given to housing, had in the last few years reduced to levels below
advances to housing loans. But the happy feature is that industrial growth is
picking up. Even, the steel sector which was hopelessly down is now having
hopes of revival.
It is only housing, amidst all these that seems to have kept up fairly stable front.
Yes, the late 90s saw even housing go through a bad phase. But, then with that
phase crossed, there has been a steady revival and stabilization of the market at
levels which can be termed as reasonable from the point of view of both the
customers and those on the supply side. Housing is a basic need and like any
basic human need will be constantly in demand. The potential for housing in
this country is huge by NHB estimates. And the requirements by NHB estimates
are around 20 million houses. There are other estimates which suggest that it is
at a much higher level. Even going by the conservative estimate taken by the
NHB, the requirements in the area of housing are massive. This really means
that a lot of investments cab be there in the coming years and there is room for
multiple players.

Going by figures of amounts given out by the organized financial sector, the
average of money being advanced for purchase of housing is in the range of 20
to 25 thousand crores every year over the last five years. In the next five years
these may be in the region of 70-75 thousand crores. There is also talk of
foreign direct investment coming in. this will add to the capabilities of the
financial sector in meeting the requirements in the area of housing. The
considered view on FDI is that it would not in any way present hardships to the
local developer community. They may on the other hand enable the local
entrepreneurs to organize the construction industry in a more stable way. The
reason why I venture forth to say this is that finance has been one of the areas of
uncertainties as far as investments into the construction industry are concerned.

FDIs might end up strengthening this area by bringing in finance and steadying
the construction industry through the joint venture route.

As far as availability of finance to the retail customers is concerned, there has

been a tremendous improvement in the possibility over the last few years. There
are over 32 NHB recognized Housing Finance Companies which dot the map of
this country with their presence all-over. The nationalized banks have in
addition made housing a thrust area and added to the reach for advancing loans
to individuals. The LICHFL, which organization I happen to represent, itself has
over 200 centres in this country which are covered by their physical presence.
Leading Housing Finance organizations like the HDFC, ICIC also have a
widespread network all over the Country giving out loans to customers for
housing. The banking major, SBI covers over 500 centres through their
branches where personal banking division functions. The other banks too are
not far behind in their reach out to the house purchasing public.

Banks have come into this sector at a time when credit off take in the industrial
sector has been low. With lot of flust funds waiting to be deployed, the housing
scene presented an attractive option to the banks to channelise their funds. This
was particularly so, because in the housing sector advances are given against
mortgage of assests, which continue to carry value, and therefore make the
loans considerably safe. Even by the experience of the housing sector in India,
NIRs have been some of the lowest as compared to any other sector of advance.

The other significant factor that has kicked up a lot of activity in the recent past,
in the housing area, is todays steadily falling interest rates of loans. The
customers today enjoy tremendous choice and can approach those giving out
finance at lowest rates. The fall in the rates has been phenomenal over the last 4
to 5 years. From rates that were around 15% and over, they have plummeted to
around 9% and even lower. The changes have come so thick and fast that an
organization like ours has had to revise interest rates over a dozen times in the
last 2 years. Banks which are outside the purview to regulations of the NHB,
have enjoyed certain added advantages too in the matter of their ability to
compete in terms of interest rates. The monetary policy of RBI which has been

constantly giving a signal for a soft interest regime has been lowering its Bank
rate and CRR constantly thus, enabling banks to have recourse to greater
liquidity at lower cost. For the Housing Finance Institutions however, there has
been a difficulty of their being able to match such interest rate reductions, since
the cost of funds borrowed earlier, kept the average cost a fairly high levels. But
then they have fallen in line with the market to remain in contention. This has
had the result of even bringing down the spread for the Housing Finance
Companies.

The customer who is purchasing a house today has not only the options of
competitively lowest rates of interest, but also choice of different types of loans
starting from the house-purchase or house-building loans to house-improvement
loans, home equity loans [ loans on mortgage of property], home extension
loans, NRI loans etc. It has never been better than this ever before.

While this is such a positive development, as far as the home seekers are
concerned, the lot of home builders are still a long way behind the satisfactory
levels. Even today, with the organized groups of Developers, being by and
large, quite influential, still availability of institutionalized finance, as a regular
source, has been almost absent as far as the average Developer is concerned.
This has been an area of major concern for the Builders. The more enlightened
platforms of developers at National levels like CREDAI and NAREDCO have
been trying to grapple with this matter to bring about some stability on this
front. In fact the Housing Finance Companies and the representatives of the
developers have been sitting together to thrash out some commonly agreed
methods whereby finance to developers can be a more dependable arrangement.
Surprisingly, it is this attempt by the developer community that has even forged
a common platform for the HFCs to meet! Credit is certainly due to the
Developers organizations for having brought the HFCs closer, in their own
quest for a solution to the area of construction finance.

One of the reasons why financiers shy away from developer-finance is that the
developers are not systematically organized like the Corporates. Their picture is
not transparent; the variations are from a proprietorship builder to partnerships,

closely held family concerns, Private Limited Companies, Public Limited

Companies etc. Often the company that comes out to borrow is part of a bigger
group and the credentials presented for assessment do not carry the total
financial picture of the group. There is a difficulty about assessing track record
of small or medium builders since they keep changing their names and one cant
push back enough to know the full picture. Even when financials are presented
they are not professionally done and there is difficulty in looking at it as one
would look at a regular corporate business house. A lot of deals do not get
reflected in the financials since two-levels deals, namely cash the cheque, make
it difficult for clear assessment of actual position. Individual developers keep
having incomes moving up and down over the years which again is a reflection
of booking of income only when sale results. Since project work and sale
alternate at different levels, incomes too fluctuate making it difficult for
assessing a picture of stable or growing incomes. Since there is so much variety
thrown in, the financial companies find it very difficult to evolve standardized
set of norms for lending to developers. In fact, after the experience of wholesale
defaults in the loan account of the Builders in the late 90s, the financial
companies have only selectively moved forward with finance to developers.

One of the most important requirements from the side of organizations like
NAREDCO and CREDAI is that the Builder community needs to he helped to
organize themselves on professional lines. A certain uniform set of accounting
practices need to be followed. The developers also need to bring certain
uniformity in their practices as far as the house purchasing customers are
concerned. In the context I would like to quote Shri Deepak Parekh, The HDFC
Supremo, who gave a call in the recently concluded CREDAI National
Convention to the developers on a few important things.

Shri Parekh appealed to Developers to go by carpet area, and charge, if

required, additionally on sq. ft rates for the super plinths area which provided
common services. This would make it very simple for the customer to
understand what area he stands to have in the flat he is about to purchase. The
other practice relates to payment being made by purchasing customers at time
periods specified in the agreement. His point was that these payments should be
related to progress of constructions and not merely on time schedule. The third

point he mentioned was regarding two-level pricing. A number of these aspects

will need to be considered by the developers. They need to make their various
centre-level associations bring in some standards in the working of the
developers. Together the industry should present a picture of confidence, if
financers and customers are to look at them with a sense of reliability. While at
the top levels big developers are well organized and institutionalized, a lot of
the others in the field are not giving out such signals of confidence to financiers.
Therefore, the role of NAREDCO and such organizations would be to bring in
uniform standards and practices amongst Builders so that they would be in a
much better position to look at institutional help which is today so much
conspicuous by its absence.

Estimation of Housing Stock:

For estimation of housing stock in the year 2007,
simple exponential growth rate in housing stock has been
computed for the nineties using the data from Population
Census. The growth rate of 3.2 per cent per annum for pucca
houses, thus computed, has been taken as valid for the next six
years for projection purposes. The estimated number of pucca
housing stock thus works out to be 49.99 million in 2007. The
growth rate for this combined category (semi pucca and
serviceable kutcha) is noted to be 0.28 per annum during the
nineties. Using this, it is estimated that the total number of semi
pucca and serviceable kutcha houses would be 9.94 in 2007,
giving the total housing stock to the tune of 59.93 million.
The NSSO in its report No. 488 has also estimated that
7.17 million constructions have been completed during the last 5
years (1997-2002). This implies that about 1.45 million
constructions have been completed and added to the existing
housing stock every year, based on the assumption of constant
addition in housing stock in each year. The annual exponential
growth rate in the housing stock thus comes to about 2.63 per
cent in the acceptable housing stock during nineties. This is
much on the higher side since the figure for katcha does not
14
exclude the unserviceable katcha. Once that figure is taken out
in the calculations, the growth rate will be less than even what is
noted from the Census data for the nineties.
Estimation of Obsolescence factor:
The Obsolescence factor has been defined by the 9th Plan
Working Group as the percentage of households living in the
dwelling units aged 80 years or more. These units are deemed to
be unfit for habitation. The value of the obsolescence factor has
been calculated on the basis of NSSO data. The Census of India,
2001, for the first time, has provided the estimates of the
households living in dilapidated dwelling units. The percentage
figure of the households living such units is 3.60%. The NSSO
in its 58th round (July Dec 2002) (Report No. 488) has also
provided the estimates of number of households living in the
house by age and condition of house, as mentioned below:
Estimation of Housing Shortage as on 2007:
Utilizing the alternate estimates of the congestion and
obsolescence factors as mentioned above, housing shortage has
been estimated as on 2007 as follows:
As on 2007

1.Households (Mn) 66.30

2.Housing Stock (Mn) 58.83
2.1 Pucca 47.49
2.2 Semi Pucca 09.16
2.3 Kutcha 02.18
3. Excess of HHs over Housing Stock (Mn) (1
2)
07.47
4. Congestion factor (%) 19.11
4.1Congestion in Hhs. (Mn) 12.67
5. Obsolescence factor (%) 3.60
5.1Obsolescence in Hhs. (Mn) 02.39
6. Upgradation of Kutcha (Mn) (2.3) 02.18
7. Total Housing Shortage (3+4.1+5.1+6) 24.71
Housing requirement during the 11th Plan Period (
2007-2012):
The housing requirement during the 11th Plan period has
been worked out by utilizing the rate of growths on various
parameters as has been applied for arriving at the housing
shortage as on 2007 assuming that the rates will not change
drastically during the 5 year period of the plan. Therefore, the
estimates of households, housing stock etc. as on 2012 will be:
As on 2012
1.Housing Shortage as on 2007 (Mn) 24.71
2.Households (Mn) 75.01
3.Pucca Houses (Mn) 53.49
4. Semi Pucca Houses (Mn) 10.05
5. Katcha Houses (Mn.) 2.56
6. Addition to households (Mn.) 8.71
7. Addition to housing stock 7.27
8. Upgradation of Katcha Houses
(Mn.)
0.38
10. Additional requirement (Mn.) (67+8)
1.82
11.Total requirement (Mn.) 26.53
Thus it is clear that, taking the business as usual scenario,
the total shortage of dwelling unit at the beginning of the 11th
Plan Period i.e. 2007 will be 24.71 million. The housing
25
shortage during the plan period (2007-2012) including the
backlog can then be computed as 26.53 million.

Reasons for variation in estimates of housing

shortages vis--vis the 10th plan Working Group:
The results of Census of India, 2001 relating to the
housing and housing amenities were not available at
the time the estimates of housing shortages were
being worked out by the 10th Plan Working Group on
Urban Housing. Understandably, therefore, the latter
had arrived at the projections by utilizing the data
from the Census of India for the period 1961-1991.
The estimates for housing parameters for the period
2002-2007 i.e. 10th plan period arrived at by utilizing
the data pertaining the earlier decades i.e. 1961-1991
are statistically not acceptable.
27
In the present case, the more recent information
available from Population Census as well as NSS has
been used in projecting the housing scenario.
Greater weightage has been given to the trend
observed during 1991-2001 rather than to that of the
earlier decades.
Information on socio economic characteristics of
households living in different types of houses
available from NSS has been utilized in
understanding the trends as also in projecting these
into future.
A different methodology and data set have been
adopted to arrive at the estimation of congestions in
the households.
The 10th Plan Working Group had defined the
concept of congestion and obsolescence in a limited
manner which does not capture the reality on the
ground.
In the present case, an attempt has been made to
define the concepts in a socially and empirically
satisfactory manner by taking into consideration the
housing situations as reflected through the latest
publications of national level statistical agencies.
While arriving at the total requirement of dwelling
units at the beginning of the 10th plan period, a very
important factor i.e. increase in the number of
households was left outside the purview of the
calculations.
28

 In the present exercise, this has been taken into

account to project the total requirement of dwelling
units at the end of the 11th plan period.
Conclusions:
The following conclusions have been made by the
Technical Group:
1. That the housing shortage as on 2007 is 24.71 million
and the total requirement of housing during the 11th
Five Year Plan period (2007-2012) will be 26.53
million.
2. The Group had a very short period at its disposal and
was to submit its report within 7 days from the date of
its first meeting. Due to time constraint, the Group
could not delve upon the issues relating to the finances
available to households and its repayment capacity of
the housing loans which also affects the affordability of
the better housing units by the households.
3. That a detailed study be given to NBO to study the
requirements of housing, both in rural and urban India,
which may take into account various other issues which
may be identified crucial for the study.
4. That the NBO needs to be strengthened suitably, both
by manpower and machines, for better coordination
between the Central and State Govt. Organisations
engaged in collection and dissemination of housing
statistics. The technical manpower may be outsourced
from open market as suggested by Deptt. Of
Expenditure, Min. of Finance in its restructuring of
NBO.
29
5. NBO also needs to be strengthened to discharge its
duties as the nodal organization in the field of Housing
Statistics to meet the requirements of planners and
policy framers by means of creating a national resource
and warehousing centre in housing statistics.
The definitions adopted by the Technical Group:
Household: A group of persons normally living together
and taking food from a common kitchen constituted a
household. The members of a household might or might not be
related by blood to one another.
Dwelling Unit: A accommodation availed of by a
household for its residential purposes. It might be entire
structure or a part thereof or consist of more than one structure.

Pucca: A structure whose walls and roof were made of

pucca material such as cement, concrete, oven burnt bricks,
hollow cement/ash bricks, stone, stone blocks, metals, asbestos
cement, wood, plywood etc.
Katcha structure: The structure whose wall and roof,
both, are made of non pucca material.
Unserviceable Katcha: Unserviceable katcha structure is
the structure with thatched walls and thatched roof.
Serviceable Katcha: A katcha structure other than the
unserviceable katcha is serviceable katcha.
Semi-pucca: A structure which could not be classified as
a pucca or a katcha structure as per definition is semi-pucca.
Such structure had either the wall or the roof, but not both, made
of pucca material.
30
Living Room: A room with floor area of at least 4 square
metre, a height of at least 2 metres from the floor to the highest
point in the ceiling and used for the living purpose. A
bedroom, sitting room, prayer room, dinning room, servant
room meeting the size criterion, are considered at living room.
A room used in common for living purpose and as kitchen or
store was also considered as living room.
Obsolescence factor: Percentage of households living
in the dwelling units having age 40-80 years and are in bad
condition and percentage of households living in all structures
aged 80+ years, irrespective of condition of structure, taken
together is taken as obsolescence factor for the purpose of the
report.
The Ninth Plan Working Group on Urban Housing had
adopted the obsolescence factor as percentage of households
living in 80+ years old dwelling units
Congestion factor: Percentage of households in which
atleast one couple is not having a separate room to live in. This
includes the households in which couples are sharing the room
with 10+ age member of the household.
The Ninth Plan Working Group on Urban Housing had
adopted the factor as percentage of married couples equire
separate room/house.
Couple: All married couples in a households irrespective
of their ages. A man with two wives in a household constituted
two married couples. But a woman with two husbands in a
household formed a single couple.