India’s urban housing shortage is 18.78 million for the next five-year plan
With banks and housing finance companies agreeing to disburse more funds as loans under the subsidised loan scheme — the Rajiv Rinn Yojana (RRY) — the Housing and Urban Poverty Alleviation Ministry (HUPA) will soon write to States to determine their targets for the scheme’s implementation. Under the RRY, loans are offered to the economically weaker sections (EWS) on subsidised interest rates for a 15-year tenure for buying houses.
HUPA officials had a meeting with banks and housing finance companies this past Wednesday to flesh out the details of the loan disbursal.
Ahead of the State Assembly elections in Madhya Pradesh, Mizoram, Delhi, Rajasthan, Chhattisgarh and Jammu and Kashmir later this year, and the General Elections in 2014, the UPA Government wants to roll out the revamped scheme. The revision will allow more funding for the purchase of houses in the lower-income categories.
According to the statistics provided by the Ministry, India’s urban housing shortage is 18.78 million for the next five-year plan, from 2012 to 2017, of which 96 per cent is in the EWS and lower-income group (LIG) categories. Shortage for the EWS stands at almost 11 million homes or 56.2 per cent, while that for LIG is at 7.41 million homes or 39.5 per cent.
“The loan amount has been increased to Rs. 5 lakh for the EWS and a maximum loan amount of Rs. 8 lakh for a LIG house will be admissible. Nearly, 54 banks and HFCs have shown interest and agreed to fund the scheme, which will give a fillip to housing for the EWS,” said A.K. Misra, Secretary, HUPA.
The Ministry has set a target of around a million households through the RRY over a period of four years with an estimated outgo of Rs. 45-50,000 crore.
The scheme will offer an interest subsidy for a maximum amount of Rs. 5 lakh for an EWS individual for a house spread over at least 21 square metres. In the LIG category, the subsidy on interest will be up to Rs. 5 lakh,.