Low cost housing can be considered affordable for low- and moderate- income earners if household can acquire a housing unit (owned or rented) for an amount up to 30 percent of its household income. In developing countries such as India, only 20% of the population are high-income earners, who are able to afford normal housing units. The low-income groups in developing countries are generally unable to access the housing market. Cost effective housing is a relative concept and has more to do with budgeting and seeks to reduce construction cost through better management, appropriate use of local materials, skills and technology but without sacrificing the performance and structure life. It should be noted that low cost housings are not houses which constructed by cheap building materials of substandard quality. A low cost house is designed and constructed as any other house with regard to foundation, structure and strength. The reduction in cost is achieved through effective utilization of locally available building materials and techniques that are durable, economical, accepted by users and not requiring costly maintenance. Economy is also achieved by postponing finishing and implementing low cost housing technologies in phases. High efficiency of workers, minimize waste in design and apply good management practices, can also be achieved.

Low cost housing technologies aim to cut down construction cost by using alternatives to the conventional methods and inputs. It is about the usage of local and indigenous building materials, local skills, energy saver and environment-friendly options.

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