Carpet area hiked for middle-income houses

HIKE IN CARPET AREA IMPLIES THAT PEOPLE BELONGING TO MIGS WILL NOW BE ABLE TO BUY BIGGER HOUSES AT LOWER COST

letters@hindustantimes.com

NEW DELHI: The government has increased the carpet area of houses eligible for interest subsidy for middle income groups (MIGS) under the Pradhan Mantri Awas Yojana (PMAY), a move that is likely to provide a boost to the affordable housing sector.

For MIG-I category (those with income of ₹6-12 lakh/ annum), the Union housing and urban affairs ministry raised the carpet area from 120 square metre (1184 sq ft) to 160 square metre (1722 sq ft). The ministry also increased the carpet area from 150 square metre (1,614 sq ft) to 200 square metre (2,152 sq ft) for those belonging to MIG-II category (income of ₹12-18 lakh/ annum).

The changes will come into effect from January 1, 2017 — the date from when the scheme became operational.

The increase in carpet area implies that people belonging to the two middle income categories will now be able to buy bigger houses at lower cost. The eligibility criteria and interest subsidies on loans for the two MIG categories remain unchanged.

“These enhancements will now enable more MIG customers to qualify for subsidy and avail the benefits provided under the government’s flagship housing program,” a statement issued by the Union housing and urban affairs ministry said.

The decision, ministry officials said, will give a boost to the construction sector that contributes to increased activity on the supply side. “This initiative is expected to result in enhanced economic activity that would contribute to improvement in the demand side,” a ministry official said on the condition of anonymity.

Apart from increasing the number of beneficiaries, an increase in carpet area will also improve the construction activity and assist in moving the housing sector forward.

“The increased construction activity in housing sector has a cascading effect on core sectors like cement, steel, machinery and other allied sectors. More construction activity in the urban areas would result in creation of more jobs for both skilled and unskilled workers,” said a senior ministry official.

The tweaks to the carpet area follows requests from both the industry and MIG customers.