Extension of Credit Linked Subsidy Scheme MIG under PMAY till 03-2019
On Friday Government announced extension of Credit Linked Subsidy Scheme MIG (Middle Income Group) under Affordable Housing Scheme by another 15 months till March 2019. In order to push demand for housing, the Central government has taken the step, the CLSS which provides benefit of around Rs 2.6 lakh on home loans taken under the Pradhan Mantri Awas Yojana (PMAY).
This was announced just after the day a new PPP (Public Private Partnership) to boost private investment in affordable housing that allows extending central funds of up to Rs 2.50 lakh for each house to be built by builders even on private land.
Real estate participants and experts though welcomed the move and said that it would push higher participation from the private sector, they raised their concerns on the implementation front. The World Bank has ranked India 185th out of 187 countries in the ease of obtaining Construction Permits Index which indicates extreme difficulty in getting requisite permissions. Similarly, legal reforms should be in place to enable title insurance.
A report released by Kotak Institutional Equities said: “Land remains a state subject. The review of FSI (Floor Space Index) and FAR (Floor Area Ratio) norms will be undertaken by state agencies based on existing regulations /infrastructure for respective cities. Such processes have taken long in the past.”
Well the decision to extend the benefit for MIG for another 15-months will provide more time for MIG beneficiaries to avail interest subsidy under the PMAY (Urban).
Under CLSS, MIG beneficiaries with annual income of above Rs 6 lakh and up to Rs 12 lakh get an interest subsidy of four per cent on a 20-year loan component of Rs 9 lakh. Those with annual income exceeding Rs 12 lakh and up to Rs 18 lakh would get interest subsidy of three per cent.
Source Link- http://indianexpress.com/article/business/business-others/affordable-housing-push-extension-of-benefits-a-shot-in-the-arm-pmay-4856795/