25 June 2009

India can/will do it. Canada? Not on your life.

It's well known that India has among the highest number of people living in desperate conditions. Many haven't homes at all or don't make enough money to buy their own.

So now Tata, the maker of the $2,500 Nano, a small car, has plans to build tiny apartments that even people of low income might manage to buy.

Tata, the Indian conglomerate that launched the "world's cheapest car," announced last month that it plans to build 1,000 apartments in an industrial enclave outside Mumbai. And like the $2,500 Nano, the units in the Shubh Griha development will be sold at rock-bottom prices.

Real estate prices in Mumbai are among the steepest in the world—apartments in South Mumbai, for example, can fetch up to $1,200 a square foot. Tata’s apartments, by contrast, will go for between $10,000 and $16,000 apiece. The catch? They’ll be downright tiny. The smallest dwelling will come in at 228 sq. feet, with the largest topping out at 465 sq. feet. Along with the Nano car, they represent one of the most aggressive attempts by a major company to corner the market on goods aimed at what management guru C.K. Prahalad calls the “bottom of the pyramid”—that is, the world’s hundreds of millions of poor people.

Could something like this happen here? No.

Why? NIMBYism.

The only way it could happen in BC or Canada is if such housing projects were created in undeveloped areas.

Tata Housing CEO Brotin Banerjee describes the Shubh Griha development as a “continuation of the group’s commitment to providing quality, innovative products for the common man.” So far, Tata’s had no trouble finding “common men” interested in scooping them up. Just two weeks after announcing the project, the company already had 8,000 applicants.

I would LEAP at the chance.

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