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What Are Affordable Housing Schemes?

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November 9, 2022


What’s Inside

Through various incentives and perks, the Indian government promotes home ownership. To assist those with low incomes in purchasing a home, the government of India introduced affordable housing schemes or low-cost housing programmes.

With the current economic scenario, these government schemes will help you avoid the high rates offered in the industry with better construction quality. These programmes are controlled by the federal and state governments, respectively.

Potential homeowners can accomplish their dream with the help of government housing schemes. Let's explore them in detail!

Best Government Housing Schemes in India

1. Pradhan Mantri Awas Yojana (PMAY Urban)

The Indian government introduced PMAY to help the Economic Weaker Section (EWS) of society to afford a home. PMAY-Urban would help via a subsidy of up to ₹2.67 lakhs for eligible people. Based on the sub-section eligibility, the loan amount and the house's size, the scheme's eligibility is determined. 

Features of Pradhan Mantri Awas Yojana (PMAY Urban)

  • Beneficiaries receive a 6.5% interest rate subsidy on house loans, depending on the income slab.
  • The maximum repayment period is 20 years.
  • Loans can be obtained to build or buy a home off the market.
  • For the buildings, sustainable and eco-friendly technologies will be employed.
  • Additionally, essential services, including connections for electricity, water, and gas will be provided.
  • Senior citizens and people with disabilities will be given preference for ground-floor housing.

2. Pradhan Mantri Awas Yojana (PMAY Gramin)

PMAY Gramin was initially introduced as the Indira Awaas Yojana. This govt housing scheme was introduced to help homeless families and give them pucca houses with all the necessary basic facilities by 2024. The PMAY Gramin programme is just one of the several government programmes designed to end poverty. This programme halves the cost of building new homes with the state while providing financial assistance to low-income families. Families living in kutcha or decaying houses will benefit from this plan.

Features of Pradhan Mantri Awas Yojana (PMAY Gramin)

Given below are the features of the PMAY Gramin program:

  • In plain regions, the Central and State governments will split the total cost incurred while providing housing benefits in the ratio of 60:40, providing ₹1.20 lakh of assistance.
  • The ratio is 90:10, with up to ₹1.30 lakh in support for each unit in the northeastern states, the Himalayan states, and the Union Territory (UT) of Jammu & Kashmir.
  • 100% financing is available for The Centre for Union Territories, which includes the UT of Ladakh.
  • The National Rural Drinking Water Program under PMAY- Gramin supplies drinking water.
  • Beneficiaries will receive high-quality cooking fuel.
  • PMAY- Gramin manages residential waste and solid waste.
  • Money is transferred electronically via a bank or post office account.

3. Rajiv Awas Yojana

The Rajiv Awas Yojana is a govt housing scheme that the central government started to eliminate slums in India. It is a Central Sector Scheme, also known as the Rajiv Housing Scheme, that intends to provide low-cost housing facilities to the urban poor and essential social amenities, basic shelter, and civic infrastructure to every citizen.

Features of Rajiv Awas Yojana

The Rajiv Awas Yojana's features and benefits are detailed below :

  • The Rajiv Gandhi Housing Yojana has two methods for implementation. These include creating a plan for a city devoid of slums and creating projects for specific slums
  • This programme offers financial support to the central government, the states, the UTs, and ULBs
  • Furthermore, as part of the Rajiv Awas Yojana, this housing scheme provides financial assistance for developing affordable housing stock through public-private partnerships.
  • The Central Government offers financial support of ₹75,0000 per Economically Weaker Section/Low Income Group for Dwelling Units of Sizes 21 to 40 sq. mt. under Affordable Housing in Partnership.

4. Delhi Development Scheme

The DDA housing plan, introduced in December 2018, provides homes for low-income groups and additional benefits for the economically weaker section(EWS) group. You must be registered under the relevant categories of the Housing Registration Schemes. First come, first-served is how apartments are distributed. The eligibility requirements determine the final allocation. You become eligible at 18, provided you do not possess a residential unit or plot larger than 67 square metres in Delhi's metropolitan area in your name, your spouse's name, or the name of any dependents. On the DDA website, you can register and apply through a bank. 

Features of the Delhi Development Scheme

The features of the Delhi Development Scheme are discussed below-

  • Delhi's low-income citizens who cannot afford a home would receive housing assistance under the DDA.
  • Flats at reduced prices would be made available to Delhi NCR residents.
  • This plan uses an online draw system to determine allocation, reducing the possibility of fraud.
  • Newly developed apartments would receive discounts of up to INR 5 lakh. The apartments will feature a parking lot and elevators.

5. Haryana Housing Board

An affordable housing initiative has been started by Haryana Shehari Vikas Pradikaran (HSVP), previously the HDA, Haryana Development Authority. The body manages the state's 6200 housing sites. Cities like Sirsa, Karnal, Rohtak, Faridabad, and others have scattered plots. A draw procedure is used to allocate the houses. The draw can be accessed on the HSVP website.

Features of Haryana Housing Board

The features of the housing plan include-

  • The Haryana Housing Board will collaborate with the central government initiative (Pradhan Mantri Awas Yojana) to provide medium homes to economically weaker people.
  • The Haryana Housing Board would provide necessities, including transportation, power, water, sanitation, and correspondence.
  • Around 6200 plots will be sold for those from economically weak sections and those in the BPL category.

6. Maharashtra Housing and Area Development Authority

The MHADA lottery programme is designed for people in Mumbai, Pune, Konkan, and Aurangabad with various economic classes. A set amount is set aside for the less fortunate population groups. Residents of Maharashtra who are employed and over 18 and have valid documents are eligible. Incomes between ₹25,001 and ₹50,000 fall into the LIG category, ₹50,001 to ₹75,000 falls into the MIG category, and ₹75,000 and above fall into the HIG category. For application, visit the city's official MHADA website.

7. Tamil Nadu Housing Board Scheme 

The goal of the Tamil Nadu Housing Board is to provide a home for every resident, and it plays a significant part in meeting this objective. It fulfils the requirement of the economically different sections of people using modern construction techniques. As a matter of policy, it ensures that construction uses high-quality materials at prices that people in these groups can afford.

Summing up

The Indian government is actively working to provide suitable housing for all citizens. Government housing projects are based on an individual's basic needs. The state administration has made a significant effort to give the citizens all the necessary facilities. Check out different affordable housing schemes the government offers if you're considering investing in a home. Even if you don’t qualify for any of these schemes and are thinking of taking out a loan to buy a home, look at Fi’s EMI calculator to understand exactly how much you will be paying depending on the tenure and loan amount taken.

Frequently Asked Questions

1. What is meant by a housing scheme?

The housing scheme refers to different programmes launched by the government and non-profit organisations to help the financially weaker section of people fulfil their dream of owning a home.

2. How can I apply for the Modi housing scheme?

You can apply for the Modi housing scheme online by visiting the official website of Pradhan Mantri Awas Yojana at https://pmaymis.gov.in/

3. What are the affordable housing schemes in India?

Here are some affordable housing schemes in India -

1. Pradhan Mantri Awas Yojana (PMAY Urban)

2. Pradhan Mantri Awas Yojana (PMAY Gramin)

3. Rajiv Awas Yojana

4. Delhi Development Scheme

5. Haryana Housing Board

4. What does affordable housing mean?

Affordable housing means housing for households with less than a year's median income. To make housing more accessible, the government has developed multiple schemes that reduce purchase prices and make loans with lesser interest rates more accessible for specific communities.


Investment and securities are subject to market risks. Please read all the related documents carefully before investing. The contents of this article are for informational purposes only, and not to be taken as a recommendation to buy or sell securities, mutual funds, or any other financial products.
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