7 things you need to know about affordable housing for middle-class

In keeping with its ‘Housing for All’ push, the Central government in 2015 had laid out a clear vision to construct 20 million households by 2022 under the Pradhan Mantri Awas Yojana (PMAY) for poor, lower and mid-income groups under its Credit-Linked Subsidy Scheme (

CLSS

). Despite all hullabaloo around affordable housing, government data in July this year reveals that merely 250 people availed the benefit of the scheme since its rollout seven months ago. The

Ministry of Housing and Urban Poverty Alleviation

defines affordable housing on the basis of size of a unit, its price and the income of a household.

Magicbricks collates a list of things that you need to know about affordable housing for the mid-income group known as ‘CLSS for MIG’ – a limited period offer which ends on December 31, 2017.

Eligibility
A beneficiary family will comprise of husband, wife and unmarried children. An adult earning member (irrespective of marital status) can be treated as a separate household provided that he/she does not own a pucca house in his/her name in any part of India. Therefore, a married couple, either of the spouses or both together in joint ownership, will be eligible for a single house only. Secondly, a beneficiary family should not have availed of central assistance under any housing scheme from the Government of India.

Classification of MIG
The MIG- I households are those having an annual income between Rs 6 and 12 lakh while MIG-II households have an annual income between Rs 12 - 18 lakh. While MIG-I will get a loan up to Rs 9 lakh with an interest subsidy at 4per cent per annum, MIG-II will get Rs 12 lakh loan with 3 per cent interest subsidy for a loan tenure of up to 20 years. Additional loans will be available at non-subsidised rates. Therefore, the total interest subsidy to be paid under the MIG group for loan up to Rs 9 lakh is Rs 2.35 lakh and on a loan of Rs 12 lakh, it is Rs 2.30 lakh per beneficiary which will be paid upfront to the beneficiary.

Size of unit
For an affordable MIG unit measuring 90-110 sq m, priced between Rs 12 and 50 lakh, a household will have to pay Rs 10,000 - 30,000 as EMI. The unit size is calculated on the basis of carpet area, which means the area enclosed within the walls of a house. This area does not include the thickness of the inner walls.

Metros vs non-metros
The Reserve Bank of India says the cost of affordable residential property for MIG should be less than Rs 65 lakh (loan up to Rs 50 lakh) in six metros and Rs 50 lakh (Rs 40 lakh loan) in non-metros. Prior to 2014, the limit was up to Rs 25 lakh for metros and Rs 15 lakh for non-metros. The central bank added that it “will periodically review the definition of affordable housing on account of inflation”.

Construction and repurchase
The scheme also supports acquisition/construction of a house, including its re-purchase, of 90-110 sq m carpet area with basic civic infrastructure such as water, toilet, sanitation, sewerage, road, electricity etc.

Preference to women
Under the scheme, widows, single working women, persons belonging to SC/ST, OBC, differently abled and transgenders will be given preference.

Disbursing agencies
The

Housing and Urban Development Corporation

(HUDCO) and National Housing Bank (NHB) have been identified as central nodal agencies to channelize this subsidy to the lending institutions, including banks and financial institutions. Hence, small banks, non-banking finance companies and micro finance institutions have also been recognized as primary lending institutions under the scheme.


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