Housing for all by 2022 in urban areas okayed by the cabinet
GN Bureau | June 18, 2015
The central government’s ‘Housing for all by 2022’ scheme for urban areas has lifted the shares of housing finance companies and few real estate companies. They were trading high on Thursday after the cabinet approved the launch of the scheme, which aims to build more than 20 million homes.
LIC Housing Finance Ltd rose 4.4% to Rs.433.80, GIC Housing Finance Ltd rose 3.4% to Rs.217.50, Dewan Housing Finance Corp. Ltd rose 4.1% to Rs.430.75, Gruh Finance Ltd rose 4.5% to Rs.243.30, Indiabulls Housing Finance Ltd rose 2.7% to Rs.597.05, Can Fin Homes Ltd rose 2.1% to Rs.716 and Housing Development Finance Corp. (HDFC) was up 1% at Rs.1,211.85.
Godrej Properties Ltd rose 3% to Rs.248.90, Anant Raj Ltd rose 1.7% to Rs.38.70, Housing Development Infrastructure Ltd rose 1.3% to Rs.91.40 and Prestige Estates Projects Ltd rose 1.3% to Rs.249.40.
The government has decided to offer 6.5% interest subsidy on housing loans to encourage economically weaker families and individuals having low income to build their own houses. Houses constructed under the mission would be allotted in the name of the female head of the households or in the joint name of the male head of the household and his wife.
The scheme will cover the entire urban area consisting of 4041 statutory towns with initial focus on 500 Class I cities and it will be implemented in three phases.
Under the credit linked interest subsidy component, interest subsidy of 6.5% on housing loans availed upto a tenure of 15 years will be provided to economically weaker section (EWS) and low income group (LIG) categories, wherein the subsidy pay-out on NPV basis would be about Rs 2.3 lakh per house for both the categories. Central assistance at the rate of Rs 1.5 lakh per house for EWS category will be provided under the Affordable Housing in Partnership and Beneficiary-led individual house construction or enhancement.
The housing scheme envisages rehabilitation of slum dwellers with the participation of private developers, using land as a resource, promotion of affordable housing for weaker sections through credit-linked subsidy, affordable housing in partnership with public and private sectors and subsidy for beneficiary-led individual house construction or enhancement.
Central grant of Rs. one lakh per house, on an average, will be available under the slum rehabilitation programme. A state government would have flexibility in deploying this slum rehabilitation grant to any slum rehabilitation project taken for development using land as a resource for providing houses to slum dwellers.
Phase-I (April 2015 – March 2017) to cover 100 Cities to be selected from States/UTs as per their willingness; Phase – II (April 2017 – March 2019) to cover additional 200 Cities and Phase-III (April 2019 – March 2022) to cover all other remaining Cities.