Homebuyers welcome Maharashtra govt’s decision to extend PMAY scheme

Twenty eight-year-old professional Maitrayee Iyer from Mumbai says she plans to own a house in the Mumbai Metropolitan Region (MMR) and plans to avail the benefit under the Credit Linked Subsidy Scheme (CLSS).

"I plan to buy a house in Navi Mumbai or somewhere in Kalyan or Dombivali belt for which I plan to avail the CLSS benefit,” said Iyer.

Another buyer, 27-year-old Soyal Rawat from Nagpur in Maharashtra said, "I plan to buy a house in the next one year as I have been planning for it since the last few months now. It is good that the PMAY scheme has been extended considering there are decent options for buying homes nearby Nagpur under the PMAY scheme. I plan to avail of a home loan under CLSS."

PMAY (Urban) extended until September 2022 in Maharashtra

Shivkumar Ade, Chief Engineer of MHADA, confirmed to Moneycontrol that the the PMAY Urban scheme in Maharashtra has been extended until September 2022.

According to officials from MHADA, the Central government has granted a preliminary extension until September 2022. "There are chances that the scheme might be extended until 2024, and the Central government might write to us in the coming days.''

Maharashtra government had set a target of constructing 19.40 lakh houses under the PMAY scheme by 2022.

According to data provided by MHADA, under the PMAY scheme, up to December, 2021 in all 1,161 projects consisting of 13 lakh dwelling units have been approved of which construction work of 4.86 lakh dwelling units are completed and that of 2.12 lakh dwelling units is in progress.

The Maharashtra government's housing department has issued a notification to fast track the approvals of the PMAY projects.

"Though the extension time given is less, we need to work towards approving the projects keeping the uniformity and smooth process in mind," the notification said. The notification said an additional force of nine engineers will be stationed at MHADA that will approve the projects from the existing team of around six engineers.

As per the current procedure, MHADA is the nodal agency and all the urban local bodies including the municipal corporations and councils after approving proposals of PMAY housing projects, send it to MHADA's PMAY cell, which in turn sends it to the state government's committee for approval.

Meanwhile, real estate developers in Mumbai welcomed the extension of PMAY scheme but were of the opinion that high land costs in Mumbai are a challenge.

Harshul Savla, managing partner, Suvidha Lifespaces (M Realty), whose company is constructing a compact 1 BHK apartment for ₹1 crore in the eastern suburb Mulund said, "This is a welcome move. However, for a city like Mumbai where the cost of land is high constructing homes under the PMAY scheme is a challenge."

"I feel the government should work towards ensuring that metropolitan cities also end up having such schemes of affordable housing being implemented on ground. Currently, I feel PMAY houses are coming up in cities or locations where the land price is relatively low, and there is no demand. This could lead to unsold inventory piling up,” he said.

A large PMAY (U) project is coming up in the city limits of Mumbai. It comprises 4,000 apartments. This is being constructed by the MHADA in Goregaon area of western suburb in Mumbai. Private developers have not come up with projects under PMAY (U) owing to high cost of land in the city.

The Housing for All by 2022 initiative was launched by the Modi government within five months of assuming office. It’s all about ensuring a home for every Indian by 2022. To boost affordable housing and achieve the vision of Housing for all by 2022, the government (Central and State) have undertaken several initiatives, such as Pradhan Mantri Awas Yojana  (PMAY) that aims to build one crore homes in urban and rural India by 2022.

With the construction of as many as 20 lakh houses yet to begin, the government is expected to extend the scheme until March 2024. Earlier, 2022 was the deadline for completing construction of houses under this scheme. The Centre has so far sanctioned 1.21 crore houses under the scheme.

The Credit Linked Subsidy Scheme for the Middle Income Group (CLSS for MIG) was announced by Prime Minister Narendra Modi on December 31, 2016. It was initially launched for 12 months until December 2017 and covered MIG beneficiaries seeking housing loans for acquisition/ construction of houses (including re-purchase) from banks, housing finance companies and other notified institutions.

For the MIG I category, which consists of individuals with an annual income of Rs 6-12 lakh, an interest subsidy of 4 percent is provided on a loan of up to Rs 9 lakh. For the MIG II category, which is made up of individuals with an annual income of Rs 12-18 lakh, an interest subsidy of 3 percent is given on a loan of up to Rs 12 lakh.  The benefits are typically in the Rs 2-2.5 lakh range.

The carpet area of a housing unit was initially revised to up to 120 sq m and up to 150 sq m  for MIG I and MIG II respectively in November, 2017 and further enhanced to up to 160 sq m and up to 200 sq m for MIG I and MIG II, respectively in June, 2018.