Affordable Housing Scheme
With a mission to provide a house for everyone in the country, the government of India had laid the vision of “Pradhan Mantri Awas Yojana” in the year 2015. The government has planned the construction of at least 20 million houses by the end of 2022. This vision was planned to keep in mind the lower and mid-income strata by its subsidy system.
However, a recent survey revealed that after such a substantial hype over affordable housing scheme, just 250 people could avail the benefit of the same after the government of India rolled out the scheme.The affordability of each house varies by the size, location, and income generated by each family.
What are the eligibility criteria for affordable housing scheme?
As stated by the government of India, a family demanding the benefit of budget homes in India comprises of wife, husband, and children who are unmarried. The adult from the family, if earning, shall be treated separately from the family with eligibility to get an affordable house, given that he does not have any pucca house under his name at any location in the country.
Affordable housing scheme under Pradhan Mantri Awaas Yojana is provided to a couple with either single ownership or joint. However, the couple shall be provided with one house only. Additionally, the families wanting to avail the benefit of affordable housing companies in India should have no prior central assistance with regards to past housing schemes laid down by the government for budget homes in India.
The MIG group is divided into two sections for various households in India. Households that have INR 6 Lakh to INR 12 Lakh as annual income shall be listed under MIG-I while the ones with INR 12 Lakh to INR 18 Lakh as annual income are listed under MIG-II for budget homes in India. As per the rules, the households belonging to MIG-I classification can apply for loan amount up to INR 9 Lakh with 4 percent interest per year.
The families belonging to MIG-II shall avail the benefit of 3 percent interest per year for loan amount up to INR 12 Lakh. The tenure for loan repayment is 20 years maximum. However, one can opt for additional loans which shall be available at normal rates as opposed to the subsidized ones.
The total 20 years cumulative interest for 9 lakh as loan amount shall be INR 2.35 lakh but for 12 lakh, the same shall be INR 2.30 Lakh. Be it Gurgaon, Delhi, Noida, Mumbai or any metro city in India there is a limit that prices of affordable housing cannot be increased beyond a limit and this limit is finalized by state government e.g one can book an huda affordable housing project in gurgaon at a starting price of Rs.14 lakhs. Similar case is with other metro cities as well.
Affordable housing companies in India have MIG units that measure somewhere between 90 to 110 sq meters. These houses come at a price of INR 12 to 50 lakh. The EMI amount for each household is fixed between the ranges of INR 10,000 to INR 30,000.
The size of the unit is calculated with regards to the area of the carpet. This is the area of the house which is inside the four walls of the house and not outside. The area calculation also excludes the thickness of walls. The total area count is only for the space available to live in.
Affordability for Metro cities vs. non-metro
For residential properties to be brought under the MIG at metro cities, the average cost is close to INR 65 lakhs for six metros. However, the same is less for non-metro cities which is about 50 Lakhs. Before the year 2014, the overall price was substantially less for both metro as well as non-metro.
For metros, the limit was 25 lakhs while non-metro residents could avail an affordable house at 15 lakhs. The scheme also includes affordability for services like sanitation, toilet, water supply, road connectivity as well as electrical connection.
As per the scheme, first preference is flaunted by widows, SC/ST caste, OBC, single women who work differently abled as well as transgender.
National Housing Bank along with HUDCO (Housing and Urban Development Corporation) has been tagged as the central agencies to help channelize the subsidy to various money lending institutions which include financial institutes as well as banks.