Everything You Want to Know About Affordable Housing

The PMAY scheme initiated by the government aims to help aspiring homeowners in India realise their dream of owning a home. The subsidy offered has made the loan affordable for all. Read on to know more about the affordable housing scheme.

In 2015, when the BJP government assumed power at the centre, the Prime Minister announced an ambitious ‘housing for all’ plan and launched the Pradhan Mantri Awas Yojana. Under the scheme, the government aimed to build 20 million affordable homes across different cities in India for the marginalised group. Also, under the scheme, the government launched the CLSS – Credit Linked Subsidy Scheme to provide subsidy on the home loan interest to the people belonging to the lower-income groups. 

The Ministry of Housing and Urban Poverty Alleviation has defined the affordable housing based on the size of the housing unit, its price and the total annual income of a household. If you are wondering what the buzz around the affordable housing about is, here are a few critical things you must know:

  • Eligibility

To claim the benefit of the PMAY subsidy, the government has laid strict eligibility criteria. A family that consists of a husband, wife, and unmarried children can claim for the benefit. If you are an adult and have a source of income, irrespective of your marital status, you can apply for the benefit provided you do not own a pucca house in any part of India. If you are married, either you or your spouse, as an individual can claim for the benefit or you both can jointly apply for the PMAY subsidy. Lastly, to claim the subsidy, you must not have availed benefit under any other central government housing schemes.

  • Size of the Unit

Under the PMAY scheme, if you have availed the subsidy, the EMI is determined based on the size of the affordable house you wish to buy and your income group. For MIG I, the carpet area of the unit being purchased or constructed should be upto 160 sq mt (approx. 1,772.23 sq ft) and 200 sq mt (2,152.78 sq ft) for MIG II category. The size of the housing unit is calculated as per the carpet area, which is the space within the walls. It does not count the thickness of the walls and the common area outside the house.

  • Preference for Women

Under the PMAY scheme, single working women, widows and women belonging to the scheduled caste, and scheduled tribe groups are given preference for allocating the affordable housing. Also, transgender people are given priority to get affordable housing.

  • Distributing Agency

The National Housing Bank and the Housing and Urban Development Corporation are the central agencies that channelize the PMAY subsidy to the financial institutions in India. You cannot directly claim the interest subsidy from the government. You must request the home loan lender to will apply for the grant on your behalf. If your claim application is approved, the National Housing Bank will advance the subsidy advance to the lender, the lenders then pass the benefit to the borrower.

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