Prime Minister Mr. Modi on Sunday claimed banks had received deposits worth Rs 5 lakh crore since he announced the demonitization scheme on November 8, and would soon give loans at cheaper interest rates.
Designed entirely for the rural masses, the ambitious scheme aims to provide affordable houses to all those living below the poverty line by the year 2022. Aiming to provide house to every Indian by the year 2022, Prime Minister Narendra Modi on Sunday launched his flagship housing scheme ‘Pradhan Mantri Gramin Awas Yojna’ in Agra. Designed entirely for the rural masses, the ambitious scheme aims to provide affordable houses to all those living below the poverty line by the year 2022. In a bid to boost rural and urban housing post demonetization, Prime Minister Narendra Modi announced interest subsidy of up to 4% on loans taken in the new year under the Pradhan Mantri Awaas Yojana. Previously, he had also announced in his national address on New Year’s eve that 33% more homes will be built for the poor under this scheme in rural areas.
Subsidy for Housing Loans
Besides, in urban areas housing loans of up to Rs 9 lakh and up to Rs 12 lakh will receive interest subsidy of 4% and 3% respectively, while in rural areas loans up to Rs 2 lakh will get an interest subvention of 3%. “Loans of up to Rs 9 lakh taken in 2017 will receive interest subvention of 4%. Loans of up to Rs 12 lakh taken in 2017 will receive interest subvention of 3%,” Modi said.
Exemption on Stamp Duty
Furthermore, Stamp duty on affordable houses could be waived soon. Being a state subject, stamp duty is fixed by the state government and varies between 4 per cent to 8 per cent. The Urban development and housing ministry has written to the state governments to exempt affordable houses from stamp duty. Affordable housing is exempt from service tax, which is around 5.35% of a property’s selling price. Naidu said his ministry had already taken up with the finance ministry the need to continue the exemption under GST. He added that his ministry had also recommended to the finance ministry that the sector be taxed at a rate which is revenue neutral, and not a higher one.
The Prime Minister further said: “In addition to this, another scheme is being put in place for the neo middle and middle class in rural areas. Loans of up to Rs 2 lakh taken in 2017, for new housing, or extension of housing in rural areas, will receive an interest subvention of 3%.”
“Even so many years after independence, millions of poor do not have their own home. When black money increased in our economy, houses became out of reach of even the middle class. The government has taken some major decisions to ensure homes for the poor, the neo middle class and the middle class,” he said. ‘Housing For All’ is a dream project of the Modi government, and the new scheme that is being talked about appears to be a way to avoid demand for real estate from falling further.
