Skip to main content

Cabinet hikes carpet area for affordable housing, higher demand seen

 Cabinet hikes carpet area for affordable housing, higher demand seen
The decision could help homebuyers access bigger, ready-tomove-in houses at lower costs.
In some good news for builders and middle-class 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-to-move-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)—follows requests from the industry which was saddled with thousands of flats that had margin- ally bigger carpet areas than allowed under the scheme.
In the first middle income category (Rs6-12 lakh/annum), the carpet area was raised from 90 to 120 sq. m (968 sq. ft - 1184 sq. ft).In the income category of Rs12-18 lakh/annum, the carpet area was increased from 110 sq. m to 150 sq. mt (1291 sq. ft – 1614 sq. ft).The 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. But realty majors said that RERA has added a positive dimension to the sector.The affordable housing sector was given a shot in the arm by the government in its budget this year, as it gave it the status of infrastructure.
This allowed tax holidays and easier access to credit for developers in this segment.“Consumer sentiment for affordable homes has been on a rise from the past three quarters with the benefits of the changes in the real estate sector bearing fruit,” said Brotin Banerjee, chief executive officer (CEO) and MD, Tata Housing. With the changes, the cost of a house will go up but Sriram Kalyanaraman, managing director (MD) and CEO of National Housing Bank (NHB), told HT that it would still be affordable for the MIG category.
“In a city like Aurangabad, a person with a salary of Rs12 lakh can easily get a loan of Rs40 lakh. With that he can easily afford to buy a house of 1184 sq. ft,” said Kalyanaraman who heads NHB, the regulator for all housing finance compa- nies. PMAY was initially targeted to benefit those with incomes up to Rs6 lakh a year.Last December, Prime Minister Narendra Modi announced expanded its ambit to include the middle-classes till December 2017.But in September, the government extended the scheme for the category to March 2019.
The Union finance ministry had allocated 1,000 crore under the programme. The ministry intends to target 50,000 people under the scheme in 2017-18.“Now we will be able comfortably provide a two-bedroom house in the MIG category, the benefits under the infrastructure category that developers get will be passed on to the homebuyers,” said Pradeep Jain, founder chairman, Parsvnath Group.

The Hindustan Times, New Delhi, 13th June 2018


Popular posts from this blog

RBI rushes in to prop up falling rupee

RBI rushes in to prop up falling rupee India’s central bank reportedly intervened in the currency markets on Monday to prevent a further slide in the local unit, which breached the 67 mark to a dollar for the first time in 15 months amid a widening trade gap and runaway import bills fuelled by high crude-oil prices. Some state-owned banks were seen selling dollars aggressively, interventions that market dealers attributed to the central bank’s strategy to stem the decline of the Indian rupee against the US currency. The rupee is the worst performing among a dozen Asian monetary units in the past three months. It lost 4.25 per cent to the dollar during the period, show data from Bloomberg. On Monday, the Reserve Bank of India (RBI) is said to have sold about Rs 800 million collectively on the spot and exchange traded futures markets, dealers said. An email sent to RBI remained unanswered until the publication of this report. The currency market has seen such a strong central bank interven…

GST Refund of Rs 20,000 Cr Pending: Exporters’ Body

GST Refund of Rs  20,000 Cr Pending: Exporters’ Body Refund of over Rs 20,000 crore on account of Goods and Services Tax (GST) is pending with the government with more than half the amount stuck as input tax credit, Federation of Indian Export Organisations said on Tuesday. While claims over Rs7,000 crore were cleared in March, the amount was Rs 1,000 crore in April.However, after exporters’ request, the GST council and tax department are organizing a second phase of Special Refund Fortnight starting May 31, which will enable exporters to draw their refunds at a speedy pace. Many exporters have been unable to file the refund of input tax credit due to technical glitches, exports and claim happened in different months. The major challenge lies on ITC refund especially because the process is partly electronic and partly manual which is cumbersome and add to the transaction cost, the exporters’ body said. On IGST, refunds are getting delayed due to airline and shipping companies not submitt…

Shrinking footprints of foreign banks in India

Shrinking footprints of foreign banks in India Foreign banks are increasingly shrinking their presence in India and are also becoming more conservative than private and public sector counterparts. While many of them have sold some of their businesses in India as part of their global strategy, some are trying to keep their core expertise intact. Others are branching out to newer areas to continue business momentum.For example, HSBC and Barclays Bank in India have got out of the retail business, whereas corporate-focused Standard Chartered Bank is now trying to increase its focus on retail “Building a retail franchise is a huge exercise and takes a long time. You cannot afford to lose it,” said Shashank Joshi, Bank of Tokyo-Mitsubishi UFJ’s India head.According to the Reserve Bank of India (RBI) data, foreign banks’ combined loan book shrunk nearly 10 per cent from Rs 3.78 trillion in fiscal 2015-16 to Rs 3.42 trillion last financial year. The banking industry, which includes foreign banks…