As per the data released by the Indian Brand Equity Foundation (IBEF), the real estate sector in India will contribute to 13% of the country’s GDP by 2025. Subsequently, its sub-sector housing witnessed a significant 32% year-on-year increase by the end of 2018. Government housing schemes have undertaken certain relief measures to implement affordable housing for the economically weaker and low-income section of the community.

In order to support the buyers from these sections, the government has introduced the following housing schemes –

Pradhan Mantri Awas Yojana (PMAY)

It was introduced in the year 2015 to provide housing for the urban and rural poor of India by 2022. However, a strict guideline has been enforced by the Government of India to fit the eligibility criteria for PMAY which are- 

  • Income

The prospective applicants need to fit with any of the four different income groups-

Economically Weaker Section (EWS), Lower Income Group (LIG), Medium Income Group 1 (MIG1), and Medium Income Group 2 (MIG2).

Individuals falling under the EWS category should have an annual household income of less than Rs. 3 lakh. Whereas the applicant under the LIG category should have an annual income between Rs.3 lakh and Rs.6 lakh. Applicants under the MIG 1 category should have an income lower than Rs.12 lakh per annum and those under the MIG 2 category should have an annual income between Rs.12 lakh and Rs.18 lakh.

With the assistance of PMAY, the home loan becomes affordable due to its credit-linked subsidy scheme.

  • Ownership

An applicant under this scheme should not own any residential property anywhere in India. The individual’s family members should not have any property in their name either.

State-sponsored housing schemes

NTR Urban Housing Scheme

The Andhra Pradesh Government has put into effect this scheme in the year 2016. It had a target of providing 19 lakh houses before the election in 2019. It maintains the same objectives as PMAY’s ‘housing for all.’ This scheme aims to facilitate getting better home loan interest rates in the form of subsidies. To avail the benefits under this project, the following eligibility criteria should be met –

  • The applicant must be a resident of Andhra Pradesh.
  • He/she should possess a white ration card or below poverty line card (BPL.)
  • The individual should not own a house or property under any other housing scheme. Eligible beneficiaries get a low-interest housing loan from approved financial institutions.

The project provides the following interest subsidy –

  • The beneficiary of the NTR Rural Housing Scheme can avail a subsidy of Rs. 1.5 lakh with reduced home loan EMI.
  • SC/ST recipient obtains an additional subsidy of Rs.50,000.
  • PMAY NTR Urban scheme attains Rs. 2.5 lakh as an interest subsidy.

Under this government housing scheme in India, the cost for per unit home size are as follows –

  1. 430 sq.ft house- 7.71 Lakh
  2. A house of 365 sq.ft- Rs.6.74 Lakh
  3. 300 Sq.ft. house – Rs. 5.62 Lakh

Tamil Nadu Housing Board Scheme

With respect to the housing needs of the state’s people, this plan of action was undertaken under the sponsorship of Pradhan Mantri Awas Yojana. The board has launched the scheme in 3 different locations – KK Nagar division, Anna Nagar division, and Vellore unit for LIG and MIG buyers.

Anna Nagar houses 236 LIG residential, Vellore has undertaken the construction of 64 flats whereas the government has made available 406 flats under the KK Nagar unit.  The tentative cost for HIG flat will be 1,08,12,400 in lieu of which initial deposit to be paid will be 1,54,13,200. Certain financial institutions offer credits to the borrower under government-subsidized schemes based on certain fundamental house loan eligibility criteria for salaried individuals or for self-employed individuals.

Following are some subsidiary housing schemes–

  1. Seva-pet Phase III
  2. Ambattur Housing

These government housing schemes in India are undertaken to reduce the number of itinerant individuals in a developing country. With respect to this measure, the government has allocated Rs.10,000 crore to the National Housing Financial Institutions.

Hence, economically weaker sections who struggle to pay loans for a house in India can easily avail credit from lenders that have affiliations with the institution. 

The government housing schemes in India, thereby aim to uplift the conditions of the urban and rural poor of the country by providing affordable and sustainable housing for them.