There is a good news for all those homebuyers who are planning for a home under Pradhan Mantri Awas Yojana (PMAY). Cabinet has approved an increase in carpet area of houses eligible for interest subsidy under the Credit Linked Subsidy Scheme (CLSS). This latest move is on Middle Income Group (MIG) under the much-ambitious Pradhan Mantri Awas Yojana (PMAY).
The existing carpet area for MIG I is increased from 90 square meters (968.752 sq. ft.) to 120 square meters (1291.668 sq. ft.). On the other hand, for MIG II category, the new carpet area will be 150 square meters (1614.585 sq. ft.). Earlier it was just 110 square meters (1184.03 sq. ft.). The changes will be effective from Jan 1, 2017, the date when it was actually implemented.
In the current real estate scenario, the builders are charging their customers on the super built-up area. With the implementation of RERA, this practice has been removed as the buyer now pay on the basis of carpet area.
A subsidy of 4% is provided to the benefices on a loan of up to ₹9 lakh under the MIG-I category, whose total annual income ranges from ₹6 lakh to ₹12 lakh. Whereas, for anyone in the MIG-II category having an annual income of ₹12 lakh to ₹18 lakh, the government provides a subsidy of 3% over a loan of up to ₹12 lakh.
CREDAI’s President Jaxay Shah has said, “Housing for All by 2022 has taken a huge leap forward by the increase in the unit size of MIG Houses under Credit Linked Subsidy Scheme.” He further added that the average middle class in smaller towns and cities would now be able to afford bigger and better quality homes than before.
NAREDCO’s Chairman Rajeev Talwar and President Niranjan Hiranandani said this decision would help in meeting the aspiration of millions of MIG (middle income group) home buyers. This decision of the government, besides helping in clearing unsold stock, will also encourage developers to launch new projects and boost the economy, GDP growth, and employment.
All and all, this move will help both homebuyers as well as real estate developers. One side, homebuyers will get a home with a bigger space and on the other, builders will now be able to clear their pile of unsold inventories.