The Prime Minister Awas Yojana has set a pioneer example as many people are living dream of owning a house. Announced on December 31, 2016, the scheme has goals of providing affordable housing by the year 2022. The scheme is made to groom up the real estate section of the country. The new introductions in the scheme has brought a new tenure period of up to 20 years. Subsidy benefits are available to those people whose yearly earnings are up to Rs. 6 lakhs. The subsidies are also equally beneficial in the income tax.

According to new subsidy plans, people who earn up to Rs. 6 lakh will get the benefit of 6.5 percent points. These percentage points will be on the  principal amount of Rs. 6 lakh. So, if their interest rate is 9 percent then it will reduce to 2.5 percent till Rs. 6 lakh and 9 percent will apply on the remaining amount. Likewise, a 12 lakh earning person will get the subsidy of 4 percent on the Rs. 9 lakh component. This goes till the highest subsidy point which is Rs. 18 lakh with a subsidy availability of 3 percentage points on Rs. 12 lakh.

The whole calculation brings the down the house cost by Rs. 2.4 lakh for a person earning Rs. 18 lakh every year.

So, with assuming the interest rate of 9 per cent, all three categories may yield a net benefit up to Rs. 2.4 lakh. This will reduce the monthly instalment by Rs. 2,200.

Some agencies like NHB (National Housing Board) and HUDCO (Housing and Urban Development Corporation) behind implementing these schemes and making sure that these are put to use effectively. Till now, government have facilitated almost 18,000 home buyers from low income group which are getting own roof for the first time.


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