Page 72 - HUDCO-SHELTER-APR21

POLICY REVIEW

of the genome and contributes housing costs are affordable to organisation which
efficacy in the management of those living in that house. conducts surveys across
the metropolis. All these Affordability is generally viewed countries for affordable
components are interlinked and as a ratio of price/rent of housing housing, considers price to
are all relevant in each other's to income of household. The income ratio below 3 to
context. The follow up of their ratio differs for different income classify housing units as
effects on one another is of groups. Lower income groups affordable.
prime importance in the can afford to pay much less (iii) Housing and Transport
planning and analysis of a proportion of their income for (H+T): In this method,
metropolis. The metropolitan housing than that of higher transport costs are also
management cannot be achieved income groups. included with housing
just by formulation of one single There are various methodologies costs to measure
policy in any of the sectors. As adopted internationally to affordability. The
the population of Indian cities estimate housing affordability: underlying idea is that
has surpassed the 'urban' level congestion in cities has

(i) Expenditure Method or

and has approached the led to rise in human
Housing Cost Burden: The
'metropolitan' level, introduction se lements at long
ratio of housing
of metropolitan scale and distances from the city
expenditure to household
discipline for smooth centre, which has resulted
income is used to measure
management and planning in increase in costs and
affordability. Housing
becomes vital. The scale of urban time spent in commuting
expenditure covers all the
planning is generally 1:5000. As (Hamidi et al., 2016). (RBI
costs related to housing
a metropolis is an aggregation of Bulletin January 2018)
including rentals,
urban units, the scale of
mortgage repayments, UN-HABITAT defines affordable
metropolitan planning is
utilities and maintenance housing as “housing which is
1:50000. This scale of planning is
costs. Housing units can be adequate in quality and location
of utmost importance for the
classified as affordable if and does not cost so much that it
comprehensive development of
the ratio is less than some prohibits its occupants from
metropolitan region and not just
cut-off value. The choice of meeting other basic living costs
the respective urban units. The
this cut-off is judgemental; or threatens their enjoyment of
metropolitan areas shall prepare
however, as a thumb rule, basic human rights”
their own development plan
it is taken to be 30 per cent. (UNHABITAT, 2011).
keeping the components in the
(ii) Median Multiple Indicator: Multiple studies in the Indian
genome in consideration for
Under this approach, the context have also suggested
their resilient and sustainable
median house price is other metrics of affordability.
development.
divided by median Government of India task force
DEFINING AFFORDABLE
household annual income headed by Deepak Parekh
HOUSING
to derive housing defined the affordability ratio for
Affordable housing in simple affordability. Demographia different income groups as given
terms is a dwelling where total International, an in Table 1.

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