Page 62 - Shelter, October 2024
P. 62
POLICY REVIEW
to 6 lakh) while MIG-I group respectively in 2021. These inherent objective of the
(with annual household changes were introduced to CLSS schemes seems
income between 6 to 12 lakh) widen the scope and coverage to be of enhancing the
is eligible for interest subsidy of the scheme as increased uptake of housing stocks.
of 4% for loan amount up to carpet areas would cater to Various reports of the
9 lakh and for MIG-II group the MIG groups’ preferred property consultancy firms
(with annual household categories of housing and have indicated a distinct
income between 12 to 18 lakh) provide a fillip to the sale deceleration in demand for
is eligible for interest subsidy of ready built affordable housing units priced under Rs
of 3% for loan amount up to housing units (Kundu and 50 lakh over the last five years
12 lakh. Primary lending Kumar, 2017). (The Hindustan Times, 2024).
institutions (PLIs) credit the However, an analytical Housing developers with
interest subsidy of Rs, 2.67 examination of the CLSS better access to policy making
lakh (against loan amount guidelines and beneficiary circles have been successful in
of 6 lakh at 6.5% interest reveals that the scheme extending the scheme benefits
rate); Rs. 2.35 lakh (against has not been responsive to to MIG groups having
loan amount of 9 lakh at 4% the housing needs of the relatively better repayment
interest rate) and Rs 2.30 economically marginalised capacities that also suit the
lakh (against loan amount of EWS/LIG groups. Receipt of financial interests of the PLIs.
12 lakh at 3% interest rate) the subsidy under the CLSS Such alignment of business
upfront to loan account of is linked to the beneficiaries’ goals of housing developers
EWS/LIG, MIG-I and MIG- eligibility to secure a home and PLIs has, in practice,
II groups respectively. This loan from the PLIs which, facilitated affordable housing
is estimated to reduce the in turn, depends on the demand catering to the needs
Equated Monthly Installment creditworthiness of the home of MIGs and developers
(Khaire, 2023).
(EMI) for EWS/LIG, MIG-I loan borrowers. This latent
and MIG-II groups by Rs. conditionality practically Rental Housing
2579, Rs.2268 and Rs. 2211 excludes the low-income
respectively (Kundu and households with uncertain Given the majority of the
Kumar, 2017). income stream as the PLIs urban resident’s lack of
check their creditworthiness affordability to own a house,
As on 12th August 2024, 6.08 from business perspectives rental housing can potentially
lakh MIG households have (Khaire, 2023). Even after cater to the increasing demand
been benefited from CLSS out becoming eligible for the for housing. Majority of the
of a total of 25.04 lakh CLSS interest subsidy, the urban urban poor engaged in the
beneficiaries, which is about poor could find it difficult to informal sector or being self-
24% of total beneficiaries. pay the balance EMI. employed prefer inexpensive
The specified carpet areas rental accommodation with
of the dwelling units for the Kundu and Kumar (2017) greater flexible housing
EWS and LIG groups remain estimated that repayment of options. So, the budget
unchanged at 30 sqm and 60 loan amount with interest proposal of rental housing,
sqm respectively while the generally exceeds half of specifically the dorm-like
same for the MIG I and MIG the earnings of the EWS and accommodations in PPP
II groups have been increased LIG groups. Moreover, on (Public-Private Partnership)
from 120 sqm to 160 sqm and the pretext of promoting mode for the industrial
from 150 sqm to 200 sqm affordable housing the workers, appears to be a
60 HUDCO-HSMI Publication
