Middle Income Housing (MIH) The Next Big Real Estate Opportunity

An all India survey conducted by Cityscape India reveals that real estate consumers across India are rooting for projects in the MIH (middle income housing) segment, which the real estate industry needs to introspect closely. Over 53% respondents felt that developers are not catering to the rising emerging middle class in India. Over 79% of the respondents with income of Rs. 6L per annum stated that the ideal affordable home would be in the range of Rs. 20Lacs Rs. 30Lacs. Qualitative response indicates that most affordable housing projects are located in areas which are extremely distant from the main city and also lack infrastructural eco-systems.

Majority of the respondents felt that reputed developers only cater to the upper classes and do not have anything to offer the middle of the pyramid. The survey also revealed that 'low cost housing' projects of 400sq.ft were not typical projects that the middle class would buy into due to lack of infrastructure, poor quality of materials and lack of space for family.

Graham Wood, Cityscape India Group Director comments, "The Indian real estate industry need to listen actively to consumers across India. Their feedback is clearly indicating that MIH is a segment which they need to now focus upon actively. Affordable housing is a different category from MIH; and as the real estate market matures developers will specifically need to come up with MIH solutions in various cities. Developers have to innovate to bring prices to realistic levels to win back their trust"

Consumers also feel that the 2006 real estate boom was primarily driven by investors and builders, not the real buyers. Today, very few developers are able to keep commitments on timely delivery of projects as banks have stopped lending and genuine buyers have lost trust in the industry.

The Cityscape India conference will have an opening session in Mumbai on December 2009 to discuss the above with leading influencers in the real estate industry.

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