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Achieving Housing for All Through Pradhan Mantri Awas Yojana

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The Pradhan Mantri Awas Yojana (PMAY) is a government of India initiative that intends to provide affordable housing to India’s urban poor by 2022. The program was officially started on June 1, 2015. Under the PMAY scheme, the interest rate on housing loans starts at 6.50 percent per annum and can be used for up to 20 years. The last date for availing of the PMAY CLSS scheme for the LIG and EWS categories has been extended to 31 March 2022.

Nirmala Sitharaman, the Finance Minister, introduced the Union Budget for 2021, in which she recommended extending the criteria for housing for all. She has also declared that affordable rental housing projects will be excluded from paying taxes. As part of her Budget speech, the FM also proposed affordable rental homes for migratory workers. She has also announced Rs.1.5 lakh additional deduction for all housing loans taken out before March 31, 2022. The FM has also announced that tax breaks for affordable housing developments will be extended for another year, concluding March 31, 2022.

Few Key Takeaways for the PM Awas Yojana from the Union Budget of the FY 2021 

  1. Until April 2021, 19.55 million dwellings have been sanctioned and 14.16 million have been finished under PMAY.
  2. By 2022, the government has set a lower near-term objective of 21.4 million PMAY-R units and 11.2 million PMAY-U units.
  3. The Union Budget’s allocation for PMAY-U has been lowered to Rs.8,000 crore for FY2022, down from a revised estimate of Rs.21,000 crore for 2021.

Of the overall expected requirement of Rs.2.88 lakh crore, the government has allocated/committed Rs.2.72 lakh crore and spent Rs.2.02 lakh crore (74 percent), leaving an outstanding commitment/allocation of Rs.16,000 crore and a pending expenditure of Rs.86,000 crore. Furthermore, of the overall estimated requirement of Rs1.81 lakh crore, it has allocated/committed Rs.0.95 lakh crore (53 percent) towards the revised targets under the PMAY.

PMAY Eligibility 

If you meet the following criteria, you may be eligible for the PMAY subsidy.

  1. An applicant/family/household should own a pucca house in any part of the country, either in his or any of his family members’ names.
  2. One adult female membership is required for property ownership.
  3. An applicant must not have ever received any central or state government of India housing assistance under any scheme.
  4. The property should be located inside all statutory towns and their adjacent planning regions, according to the 2011 census (updated by the government from time to time).

The following are some key considerations to keep in mind about the scheme: 

1. All home loan accounts under the Pradhan Mantri Awas Yojana list would be linked to the beneficiary’s Aadhaar numbers.

  1. The subsidy is only available for a maximum of 20 years.

3. You will be charged the bank’s current interest rate by the lender from whom you acquired a home loan.

4. Though you shift lenders to take advantage of low-interest rates, even if you have already made use of the CLSS interest subvention benefit, you will not be eligible for the interest subvention benefit.

Final Thoughts

If you fall under any of the categories defined under the PMAY scheme, use the scheme to your best advantage by availing of a home loan on a subsidized interest rate.

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