Affordable Housing Finance's Regulatory Irritants

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India's much (picture a dude with hands stretched wide) needed affordable housing crisis needs more than mere financial directives and tall aspirations. 

That's because the folks who need access to affordable housing the most are the ones that are not being able to get any.

Where's Your Pay Slip?

The lower middle-class and low-income segment deserve housing more than the others. Per this report, the growth (in terms of lending) is much higher in this segment, at around 25 to 30% per annum.

However, while our mailboxes receive a home loan offer once a week on an average - a function of publicly known salaries and credit scores - the folks who really need that housing loan don't have either. 

In the absence of a credit score and a valid proof of monthly income, lenders are hand-tied due to the absence of a mechanism to extend credit to the neediest, despite the big talk and an abundance of liquidity in the system - so basically, we are achieving zilch. 

Half-Hearted Regulatory Push

Constant regulatory insertions have burdened the affordable-housing finance companies in different ways, meaning more houses to the needy simply cannot be sold. 

After being brought under the ambit of the RBI, from the earlier National Housing Bank (NHB), the multiplicity of regulatory agencies has made compliances cumbersome and costlier. 

And with multiple agencies towering over mortgage firms, there seems to be more confusion and hesitancy in extending the much needed credit to affordable housing aspirants. 

Word On The Street

🎙 "The housing finance field has more than returned to normal and is picking up well. Liquidity isn’t an issue. More than anything else, regulatory irritants are a major speed-breaker for the sector." says Munuswamy Anandan of Aptus Value Housing Finance.