‘Housing for All’ needs more direct measures to become a reality

While the Central Government is providing sops in various ways through Pradhan Mantri Awas Yojana (PMAY) to encourage low cost housing, home buyers and realtors urge government to provide the sops and

HYDERABAD: While the Central Government is providing sops in various ways through Pradhan Mantri Awas Yojana (PMAY) to encourage low cost housing, home buyers and realtors urge government to provide the sops and incentives directly to the home buyer instead of routing them through state governments, for making it more efficient.

Under PMAY, centre provides aid to Urban Local Bodies (ULBs) and other implementing agencies through states or UTs in four ways —in-situ rehabilitation of existing slum dwellers with private participation, affordable housing in partnership, subsidy for beneficiary-led individual house constructions or enhancements and credit linked subsidy.Unlike credit linked subsidy where home buyers will be directly provided with subsidy amount, in all the other modes, unless states play a proactive role, low cost housing will not take off.“States like Rajasthan, Gujarat, Orissa are proactive in using the benefits provided by Centre and encouraging low cost housing. But it is yet to take off in states like Telangana. Though Telangana government came up with ‘double bedroom homes for poor’, it is facing various hurdles in initiating it, said C Shekar Reddy, Immediate Past President of CREDAI.

The Prime Minister has announced loans of up to Rs 9 lakh will receive interest subvention of 4 per cent and loans of up to Rs 12 lakh will receive interest subvention of 3 per cent in urban areas.
Bankers, realtors and builders opine that this will decrease the cost of a home considerably for lower income groups. However, the government should focus on measures which will directly motivate buyers to own a home or encourage realtors to go for low cost housing, added Reddy.
Speaking on similar lines, Anuj Puri, Chairman and Country Head, JLL India said that there has been a large deficit of affordable housing projects in India. But government’s push to affordable housing sector is attracting builders towards it. Apart from developers, private equity players are showing interest in funding such projects,” he pointed out.

Currently, banks offering loans for low cost housing are forwarding the applications for interest subsidy to National Housing Bank (NHB). After verification from NHB, subsidy amount is directly deposited in beneficiaries account, thus effectively reducing the housing loan and Equated Monthly Installment (EMI) for the home buyer. But this scheme is applicable only in urban areas.

“If the family’s annual  income of home buyer applying for loan does not exceed Rs 6 lakh and the carpet area of houses being constructed is up to 30 square metres and 60 square metres for EWS and LIG respectively, then interest subsidy is directly deposited in home buyer’s account. But right now not many home buyers know this and more publicity needs to be done to ensure that more poor and LIG people become homeowners, availing this benefit,” pointed out AP region’s head of a public sector bank.        
“Interest subsidy on loans for low cost housing under PMAY should be implemented effectively to achieve government’s aim of housing for all by 2022,” summed up ASSOCHAM President, Sunil Kanoria.
(Inputs from Pramod Thomas)

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