Maharashtra CM Fadnavis: Business as Usual Won't Solve Affordable Housing Crisis
Maharashtra Chief Minister Devendra Fadnavis emphasized that traditional approaches and incentives have failed to reduce home prices, calling for innovative solutions to tackle the affordable housing crisis.
Affordable HousingReal EstateMaharashtraDevendra FadnavisCredaiReal Estate MaharashtraAug 18, 2025
Fadnavis noted that for the past decade, the government has implemented measures suggested by developers to improve affordable housing. However, these efforts have not yielded the desired results. "For the last ten years, we have done all the things that you (the developers) said would improve affordable housing, but prices have not reduced. This is not a complaint, but you demanded that premiums be reduced, and when we did so, we saw that home prices did not reduce. We thought that if we built the Coastal Road and Atal Setu, home prices would reduce, but prices reached the skies due to the Coastal Road," Fadnavis explained.
Real estate companies in Mumbai are required to pay a construction premium, also known as a development charge, to civic authorities for various construction activities. Fadnavis emphasized that a different approach is needed to genuinely improve affordable housing. "If we have to improve affordable housing in real terms, we have to bring in different interventions. We can't do it with a business-as-usual approach," he stated.
While rising property prices are not necessarily a negative outcome, as they inject more capital into the economy, the CM stressed the need for balance. "Property prices rising is not necessarily an adverse outcome as more capital gets injected into the economy. However, we need to ensure that this growth is inclusive and benefits all segments of society, particularly those who need affordable housing the most," Fadnavis added.
According to a recent report by Knight Frank, Mumbai has recorded one of the fastest growth rates in residential prices among major global cities. During the April-June quarter, Mumbai's housing prices rose by 8.7 percent year-on-year, ranking sixth out of 46 major residential markets tracked in the report. The real estate sector is a significant contributor to India's economy, and a report by EY and CREDAI projects that the share of real estate in India's GDP is expected to reach around 18 percent by 2047.
Fadnavis's call for innovative solutions to the affordable housing crisis is a wake-up call for both the government and the real estate industry. It underscores the need for a more collaborative and forward-thinking approach to ensure that housing remains affordable for all residents of Mumbai and other major cities in Maharashtra.
Frequently Asked Questions
What is the primary issue highlighted by Maharashtra CM Devendra Fadnavis?
The primary issue highlighted by Maharashtra CM Devendra Fadnavis is that traditional methods and incentives have failed to reduce home prices, leading to a persistent affordable housing crisis.
What specific measures have been taken to improve affordable housing in Mumbai?
Specific measures include the reduction of construction premiums, the construction of major infrastructure projects like the Coastal Road and Atal Setu, and other incentives suggested by developers.
What is the impact of rising property prices on the economy, according to Fadnavis?
According to Fadnavis, rising property prices are not necessarily negative as they inject more capital into the economy. However, they must be balanced to ensure inclusive growth and affordability.
What is the projected contribution of the real estate sector to India's GDP by 2047?
A report by EY and CREDAI projects that the share of real estate in India's GDP is expected to reach around 18 percent by 2047.
What is the role of CREDAI-MCHI in the real estate industry in Mumbai?
CREDAI-MCHI is the local chapter of the developer lobby group CREDAI, representing real estate developers in the Mumbai metropolitan region and advocating for policies that support the industry.
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