Demonetization - A huge positive for Real Estate
On 31st December 2016, honourable Prime Minister Narendra Modi announced measures that included financial assistance for urban and rural poor for buying and building homes. Vastushodh has been dedicated to the cause of ‘housing for all’ for over a decade. The fact that this move is aimed at fulfilling the government's promise of housing for all is an encouraging step in our endeavour to see every Indian live in a house of their own.
The decision is expected to strengthen low income housing localities of urban areas as demand for such housing projects is likely to enhance.
The government decided to provide interest subvention of 3% and 4% for loans of up to Rs. 12 lakh and Rs. 9 lakh respectively under the PMAY (Pradhan Mantri Awas Yojana) Scheme.
Another relief is a 3% subvention for loans of up to Rs. 2 lakh to build and expand existing houses in rural areas. There is likely to be an increase in the number of homes to be built in rural areas by 33% under the PMAY scheme.
The Managing Director of Vastushodh Projects, Mr. Sachin Kulkarni told TOI, “For the first-time home buyers will stand to benefit with these discounts. The announcement on increase in subsidies on loan amounts is a big step towards housing for all”.
Under the vision of ‘Housing for All by 2022’, the government has announced various benefits including the interest subsidy of up to Rs. 2.2 lakh for homebuyers. Vastushodh has been granting this subsidy to its AnandGram residents in Ketkawale and Wakhari since last year itself.
People from EWS (Economically Weaker Sections) and LIG (Low Income Groups) seeking housing loans are eligible for an interest subsidy @6.5% for a tenure of 15 years, or during the tenure loan whichever is lower, on the initial Rs. 6 lakh. With the 4% interest subvention, which translated to a 45% cut in interest rate for EWS and LIG segments, a lot of homebuyers will qualify to afford homes in this segment.
Furthermore, the State Bank of India's announcement to cut lending rate by 0.9% and existing interest subsidy will bring the instalments of borrowers down substantially, prompting developers to build more in this segment.
On November 22, the government approved the construction of 1.97 lakh additional affordable houses under Pradhan Mantri Awas Yojana (Urban) taking the total to 12.83 lakh units. With this, we feel that we are a step closer to realising our goal of housing for all.