Bigger houses eligible for loan subsidy in MIG category

NEWDELHI: In some good news for builders and middleclass homebuyers, the Union cabinet increased the carpet area of houses under the government’s affordable housing scheme on Thursday.

The decision could help homebuyers access bigger, ready-tomove-in houses at lower costs, while developers with large inventories could look forward to renewed demand, triggering a virtuous cycle of employment generation and economic growth.

The tweaks to the NDA government’s flagship housing programme – Pradhan Mantri Awas Yojana (PMAY) – follow requests from the industry which was saddled with thousands of flats that had marginally bigger carpet areas than allowed in the scheme.

In the first middle income category (₹6-12 lakh/annum), the carpet area was raised from 90 to 120 square metre (968 sq ft-1,184 sq ft). In the income category of ₹12-18 lakh/annum, the carpet area was increased from 110 sq mt to 150 sq mt (1,291 sq ft-1,614 sq ft). Eligibility criteria and interest subsidies on loans remain unchanged.

“The increase in carpet area will enable individuals under the MIG category to have a wider choice in developers’ projects. It will give a boost to the sale of ready built flats in the affordable housing segment,” Union housing and urban affairs minister Hardeep Puri told journalists.

The mushrooming of private developers from 2007 to 2013 saw landowners turn real estate companies.

The obvious fall out was incomplete projects, and a breakdown of consumer and investor confidence.