Government and Housing Ministries Role in Creating Affordable Property in India Under PMAY

To create more affordable Property in India, the housing ministry had hoped to join the Credit Linked Subsidy Scheme (CLSS) with the prime minister’s vision to build a house worth the name for every Indian within a period of five years.
The Story Thus Far
Over the past few months and Government has received over 1.66 crore applications for credit linked subsidies for housing loans. In India the online internet penetration is a mere 37 percent but in urban areas stands at 62 percent, these statistics indicate that the need to digitize land records exists and will add efficiency to the Indian real estate sector. Additionally the action leading to digitalising land records and making them available to landowners will lead to the creation of more jobs in India as well. Citizens of India will be able to access digitized records online as internet penetration, with the aid of some facilitation, will be deep enough to allow doing so by leading visitors to property sites in India that have been created by the government.
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Financials at the Heart of the Matter
There has been a reversal of sorts between housing shortages and capital for new houses. Earlier housing shortages were computed whereas today the extent of the subsidies sanctioned are computed. Hence the mindset has shifted from a negative image to a positive one where rather than bemoan the shortages in housing, discussions revolve around how much subsidies shall be provided, a shift from the physical to the financial has taken hold concerning Realestate in India. This change signals a diversion from the earlier passive stance to an active one concerning real estate.
In a previous budget under the Pradhan Mantri Awas Yojana the CLSS allowed for a 6.5 percent interest subsidy to be credited to the borrowers account on a loan up to 6 lakhs taken for a house that was 30 to 60 square meters in carpet area. In the instance mentioned a family whose annual income Is upto 6 lakhs is eligible for the subsidy. The applicant which meets the criteria in effect gains a net subsidy of 21 percent under this scheme.

Creating a Wider Subsidy Net
For the first time ever the government has spread the social net wider to include Lower Income Group families rather than just the Economically Weaker Section (EWS). On the eve of last year the net was broadened further to include subsidies for Middle Income Group (MIG) 1 and 2 allowing households with an annual income up to 12 lakhs could earn a subsidy of 4 percent. By creating a wider net, more individuals will be able to own Property in India at rates that are more and more affordable.


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