ARHC has potential to be a game changer in housing

The second edition of the series was based on the topic “Affordable Rental Housing for the Urban Poor – Demand, Supply and Management Dynamics”. Amrit Abhijat, Joint Secretary (Housing for All), Ministry of Housing and Urban Affairs (MoHUA); Mukta Naik, Fellow Researcher, Centre for Policy Research; Darshini Mahadevia, Professor, Faculty of Planning, Ahmedabad University; and Pankaj Kapoor, Founder & MD, Liases Foras Real Estate Rating and Research Pvt Ltd. The webinar was moderated by Dr Gautam Bhan, Senior Lead, IIHS; Vidya Bhushan, Deputy Director, LBSNAA and Swastik Harish, Senior Lead, IIHS.
The webinar began with an opening statement by Vidya Bhushan who welcomed the panelists and introduced the topic of discussion. He mentioned that the Affordable Rental Housing Complexes (ARHC) Scheme was launched by the MoHUA under the Pradhan Mantri Awas Yojana (PMAY) to provide affordable living spaces for the working class in India. Swastik Harish spoke next and described the webinar as a space created “to debate and discuss all the dynamics that go into rental housing.” He mentioned that the webinar aims to put into the picture the aspects of rental housing future like nature of supply, public provision and management of rental housing.
The first speaker was Amrit Abhijat who briefly explained the scheme and mentioned how the COVID-19 pandemic was a “push factor” for this scheme to be implemented. He addressed the reality where people do not always have income disposable for ownership of housing projects and how the PMAY is meant for such people, including those from economically weaker sections, low and middle-income groups. Economics and web can make it possible for ARHC owners to market what they have to offer with transparency. There will need to establish contact between the two segments in the system, that is, provider and the one seeking, which cannot always be web-based and therefore he suggested that civil society organisations and urban local bodies will have to play a crucial role in the interaction process. He believed that the ARHC scheme furthers the spirit of PMAY. He also referred to the necessity of involving civil society for mobilisation of people under the project. He said, “Urban local bodies will have to conceive committees at the local level where interaction can be established between ARHC owners, aggregators and the urban local body of a particular area.”
Mukta Naik addressed the issue of diverse demand landscape and how that needs to be analysed to understand where these rental housing projects might come up. She raised the issue of exclusion of migrant workers arising in the scheme and she believed that to plug this gap, the administration can make sure what kind of organisations would confer to aggregate demands of rickshaw pullers, daily wage workers or domestic workers. She said, “COVID-19 has shown us that we do need to prioritize adequate housing quality.” Informal market is already aggregated enough to have intermediaries placed and these owners already have the idea of demand and supply in the market which they can pick and apply to formal market when included. The informal rental housing has grown, establishing understanding between renters and lenders about late payments or oral agreements. These things come in handy for the migrant labourers who move to places from time to time or do not have a constant source of income. It will take time for such renters to adjust to the formal housing system. The scheme right now only invites people who are ready to set up 40 rental units. However, the small scale landowners are the ones who will be able to match the demands based on their understanding and high share in the rental market.
Kapoor said, “I don’t see that the scheme has economic viabilities to draw many people.” The scheme predicts that it will be able to get 90 per cent occupancy, which he believed was too much optimism. He said that the government needs to introduce this as a welfare scheme rather than a source of profit. Dr Bhan added to his address and described how certain interventions in the scheme, after recognising the bridging of gaps, is central. He referred to a programme where cess is collected by the State governments and Union territories and utilized for the welfare of building and other construction workers by respective State Building and Other Construction Workers Welfare Boards. He said that the same cess fund can be used to build workers’ housing with different logic to dormitories
and ARHC.
Darshini reiterated on Mukta’s address and on the fact how the demand and supply in the rental housing market are extremely diversified because the country is diversified in many aspects. The conundrum is that the government is trying to formalise rental housing but taxation and many other costs jack up the prices which ultimately dissuades renters from partaking in the scheme, regardless of how ‘formalised’ or safer it maybe be. She added, “Civil society organisation, in the context of trust and social network, cannot be built overnight.”
Harish concluded with an emphasis on the concern of financial viability of the scheme and introduction to the idea of adopting a hybridised model for the diversified demand and supply. He mentioned the example of a voucher system for tenants in the USA, functioning in buildings and projects built by the subsidised rental developer. He added, “This attempt of ARHC in no way tries to address the problem in its entirety.” The scheme currently looks like an attempt to address limited clientele who are productively employed in industries. It does not cater to anybody or everybody, be it a businessman interested in investing or a person seeking rental houses.