Affordable Housing Schemes in India: A Complete Guide

Owning a home is a long-cherished dream of many individuals and families in India, particularly belonging to the lower and middle-class sections of society. But, due to the rising inflation, property prices are going up and up. This has made owning a home a distant dream for a big chunk of the society. This is where affordable housing or budget housing schemes emerge as the most sought-after avenue for low and middle-income groups by helping poor and middle-class people own a home quickly and easily. The government of India has come up with numerous affordable housing schemes that provide low-cost housing to this section of the society.

This post intends to take a deep dive into various affordable housing schemes in India and highlight the government’s role and crucial factors related to affordable homes in India. 

What does affordable housing mean?

Affordable housing primarily refers to a concept in which low-priced houses are provided to a section of the community that is not capable enough to buy typical houses. 

The first and foremost objective of affordable housing is to provide good, safe, and cost-effective living spaces to the poor and middle class. Such housing schemes are purposefully made considering the income levels of the buyers. 

In a developing country like India, affordable housing has been playing a pivotal role in sustainable urban development by tackling the housing requirements of a wider section of society.

Government-run Programs for Affordable Housing in India

The government of India runs various programs to provide low-cost housing to the marginalized sections of society living in urban and rural areas. Some of them are highlighted below:

1. Pradhan Mantri Awas Yojana (Urban)

Working on its mission to provide “Housing for All,” the Government of India launched Pradhan Mantri Awas Yojana – Urban (PMAY-U) – ‘Housing for All’ in 2015. The program is managed by the Ministry of Housing and Urban Affairs (Mohua). Earlier, the deadline for this flagship project was 2022 which was later extended till December 2024.  According to the scheme objectives, Ministry provides Central assistance to States/ UTs in regard to the housing requirement of the slum dwellers and other individuals belonging to Economically Weaker Sections (EWS), Low Income Group (LIG) and Middle Income Group (MIG) categories in the urban spaces through following four verticals:

1.  Beneficiary-led Individual House Construction or Enhancement (BLC): In this section, Central Assistance of ₹1.5 lakh is given to people and qualified families belonging to EWS categories.

2.  Affordable Housing in Partnership with the Public or private sector (AHP): An assistance of ₹1.5 lakh per EWS house is given by the Government of India in housing projects where minimum 35% of the houses in the projects are reserved for EWS category and one project has minimum 250 houses.

3.  “In-situ” Slum Redevelopment (ISSR): Slum redevelopment assistance of ₹1 lakh per house is approved by all houses developed for qualified slum dwellers under the program, In-situ Slum Redevelopment employing land as a Resource with the involvement of a private developer.

4.  Credit Linked Subsidy Scheme (CLSS): An interest grant of 6.5%, 4% and 3% on loan value up to ₹6 lakh, ₹9 lakh and ₹12 lakh were approved for the qualified recipients of the Economically Weaker section (EWS)/Low Income Group (LIG), Middle Income Group (MIG)-I and Middle Income Group (MIG)-II respectively availing housing loans from Banks, Housing Finance Companies and other such units. 

2.  Pradhan Mantri Gramin Awas Yojana (PMAY-G)

Pradhan Mantri Gramin Awas Yojana is another flagship housing program by the Government of India. The scheme was launched in 2016 by the Ministry of Housing and Urban Affairs (MoHUA). It endeavour to provide a pucca house, with all essential amenities, to all houseless families and those living in kutcha and broken houses.

Under PMAY-G, the house must have a minimum area of 25 square meters, inclusive of an area reserved for cooking. As of September 27, 2022, 2.00 crore of the 2.72 crore planned number of dwellings has been developed.

The Socio-Economic and Caste Census (SECC) criteria are usually checked to identify the beneficiaries, who are then put to the test by the Gram Sabhas. The beneficiary’s Aadhaar-linked bank account or post-office account receives the approved funds directly. The PMAY-G program has been extended for a further two years, ending on March 31, 2024. 

3. Rajiv Gandhi Awas Yojana Housing Scheme

Riding on a mission to make India “slum free”, Rajiv Gandhi Awas Yojana Housing Scheme is managed by the Ministry of Housing and Urban Poverty Alleviation (MoHUA). Under this scheme, all slums, registered, or non-registered are to be brought under formal system.

The major objectives of this scheme are listed below:

Providing basic and affordable housing facilities with all amenities in civic, infrastructure, and social arrangements to the slum areas to help curb the growth of slums.

• Provide the Urban poor with easy credit support from various financial programs and banking organizations. 
• To provide basic amenities like water supply, access roads, healthcare, electricity, sewerage, drainage system, street lighting, etc. in slum areas. 
• To redraft any bills that intend to tackle the causes behind the development of slums.
• Allowing equal participation at every decision-making stage empowers the slum dwellers by strengthening and nurturing Slum Dwellers Associations/ Federations, hence eliminating societal marginalization; 
• The Rajiv Awas Yojana for the slum dwellers would promote lifestyle upliftment and thus reduce the further increase in slums through the collaborative activities by the government and the Urban Poor.

4. State-run Housing Schemes 

Apart from the schemes run by the central government, there are several affordable housing schemes run by different states in their regions. For example, DDA (Delhi Development Authority) runs its own housing schemes meant for the marginalized section of the society. However, it is necessary to note that all these schemes promote the welfare of poo and middle class by providing them safe and affordable houses. 

A list of many such schemes is given below:

• JNNURM and RAY schemes in Maharashtra
• Karnataka Housing Board schemes
• Tamil Nadu Slum Clearance Board scheme
• BEST Housing Schemes in Mumbai
• JNNURM Basic Services to Urban Poor in Andhra Pradesh
• MHADA lottery system for low-cost flats in Mumbai
• Madhya Pradesh Housing Board schemes
• Odisha Landless Slum Dwellers Housing Scheme

How to apply for Pradhan Mantri Awas Yojna?

For those want to avail the benefits under the Pradhan Mantri Awas Yojna, below is the step-wise procedure:

1. Eligibility Check

Prior making an application to the program, it is necessary to check the eligibility for PMAY. Please note that the eligibility requirements vary for urban and rural schemes. Also, the income category also plays a major role in making one eligible for the benefits. 

The eligibility criteria for PMAY are mentioned below:

• The applicant must be a citizen of India
• The applicant should be of legal age
• The applicant should not be the owner or any other property
• The applicant’s annual income should not exceed the given maximum income limit for the program

2. Pick The Appropriate PMAY Component

There are two major components of PMAY – Urban and Gramin. The selection of any of them depends on the area where you want to get the house. 

3. Visit the PMAY Official Website

The next thing to do is to visit the official website of PMAY – https://pmaymis.gov.in/. now, follow the given procedure to submit the application. 

• PMAY Urban: https://pmaymis.gov.in/
• PMAY Gramin: https://rhreporting.nic.in/netiay/home.aspx

4. Online Registration

Click the “Citizen Assessment” link on the portal. Choose the type of loan needed under the apply online category. Various options include:

• In Situ Slum Redevelopment (ISSR)
• Affordable Housing Partnership (AHP) 
• Beneficiary Lead Construction Enhancement (BLCE)
• Credit Link Subsidy Scheme (CLSS)

5. Furnish Required Details

Provide details like:

• Name and Aadhaar ID (For Authentication)
• Names of the City, District, and State you reside in
• Present Age
• Your Gender
• Marital Status
• Present Address
• Contact Information
• Preferred Component of Mission (for e.g., CLSS, AHP. etc.)
• Address Information of the Property (To Buy/Construct)
• Type of House (Kutcha/Pucca)
• Details of Family Members
• Joint Holder Information (If Applicable)
• Religion and Caste
• Bank Account Number and IFSC Code
• Current Employment Status
• Current Monthly Income
• Housing Requirement (New House/ Enhancement)

6. Application Submission

Enter the provided captcha code after completing the information and agreeing to the terms and conditions. To submit your application online, select the “Save” option in green. An assessment number ID for your application will be sent to you; be careful to copy and keep it. 

7. Track or Edit Application:

To edit or track your assessment status, visit the website, and give reference of the given ID.

The Conclusion

As India is poised to become the 3^rd largest economy in the world by 2030, it is necessary to ensure housing for all due to the increasing population of the country. For the poor and middle-income groups in the country, these affordable homes in India come as the big respite by letting them have their own home in the easiest possible way. 

Despite the amazing success of Pradhan Mantri Awas Yojana, more efforts are required to bring more individuals and families under the umbrella of budget housing in India. Thankfully, both public and private players have been working together in this direction. According to experts, value-centric policies, public-private associations, and unmatched community involvement are key to achieve the dream of “housing for all.”