Housing markets in Spain and the US: some lessons for India

Abstract

India suffers from severe housing shortages, especially for the economically weaker sections of the society. And the house prices have been booming for nearly a decade. The markets are opaque, price indices have not been developed, market suffers from absence of regulator and there is no redressal mechanism in place. The procedure for constructing and purchasing a house in India is varies across the country, legal practices are unclear, and laws pertaining to acquiring of land or a house are neither transparent nor uniform. Therefore, housing markets have not developed in India. The paper seeks to learn from the experience of housing sector in Spain and the USA that have developed over decades. The housing markets in both the countries are well developed, and more significantly have created transparent systems for the convenience of citizens. The procedures are standardized and there is transparency in the pricing of products, procedures to be followed and availability of legal recourse. India needs to put in place a number of systems, laws and institutions to ensure that housing sector develops in a balanced fashion.