The NDA (National Democratic Alliance) government has increased the carpet area of houses that were eligible for interest subsidy under the Credit Linked Subsidy Scheme (CLSS). This fortunate revision will be applicable to the Middle Income Group (MIG) under Pradhan Mantri Awas Yojana (PMAY).
The introduction of landmark Real Estate (Regulation and Development) Act, 2016 (RERA) is against the practice of super built up areas and wants to remove it. The affordable housing sector was given a shot in the arm by the government in its budget this year, as it gave it the status of infrastructure.
Six key things to know about the new rules announced under PMAY
6 Key Updates Under PMAY
1) More homebuyers can now benefit from PMAY subsidies and choose from a wider range of ready-to-move-in flats. This will also boost the affordable housing segment.
- 1) MIG-I: Carpet area increased from 90 sq. mt. (968.75 sq. ft.) to 120 sq. mt. (1291.67 sq. ft.)
- MIG-II: Carpet area increased from 110 sq. mt. (1184.03 sq. ft.) to 150 sq. mt. (1614.58 sq. ft.)
2) The decision, besides helping in clearing the unsold stock, would also encourage the developers to launch new projects, which in turn would boost the economy, GDP growth and employment opportunities. The move would now bring the entire demand for affordable housing under the interest subvention scheme.
3) The scheme covers middle-income homebuyers under two categories:
- MIG-I: Annual income between ₹6 lakh to ₹12 lakh
- MIG-II: Annual income between ₹12 lakh to ₹18 lakh
4) In the MIG I, an interest subsidy of 4 per cent is allowed for loan amounts up to Rs 9 lakh while in the MIG II category an interest subsidy of 3 per cent is allowed for loan amounts of Rs 12 lakh. Housing loans above Rs 9 lakh and Rs 12 lakh will be at non-subsidised rates.
5) One can avail PMAY linked loans from any primary lending institutions such as commercial banks, housing finance companies, Regional Rural Banks s), State Cooperative Banks, Urban Cooperative Banks, Small Finance Banks, Non Banking Financial Company and so on. There will not be any processing charge for eligible housing loan amounts as per income criteria under the Scheme.
6) Realtors’ body CREDAI and NAREDCO hailed the government’s decision to hike carpet area of houses eligible for interest subsidy under the Pradhan Mantri Awas Yojana-Urban, saying the move would help middle income buyers and help the sector in clearing unsold homes.
Conclusion
The Pradhan Mantri Awas Yojana (PMAY) is a game-changer for middle-income homebuyers, making bigger homes more affordable through increased carpet areas and interest subsidies. With real estate developers encouraged to create new projects, the housing market is set for sustained growth.
Frequently Asked Questions
- Who is eligible for the PMAY CLSS scheme?
Middle-income buyers with an annual income between ₹6 lakh to ₹18 lakh can apply for home loan subsidies under PMAY. - What is the benefit of increased carpet area under PMAY?
The larger carpet area allows homebuyers to access bigger homes at lower costs, widening their choice of properties. - How can I apply for a PMAY home loan?
You can apply through banks, NBFCs, housing finance companies, and other approved lending institutions under PMAY.