Budget 2019 saw finance minister Nirmala Sitharaman attempt to leave no stone unturned in making it clear that the government was fully committed to its much-hyped ‘Housing For All By 2022’ scheme.
“Nearly 1.5 crore rural homes have been completed in the last five years,” Sitharaman announced, while making her maiden Budget speech, adding, “the second phase of the Pradhan Mantri Awas Yojana for 2020-2022 will see 1.95 crore affordable houses provided to all eligible beneficiaries.” The finance minister emphasised that these homes would be provided with toilets, electricity and LPG connections.
In what must come as encouraging news to the government’s efforts in the affordable housing space, Sitharaman noted that the average number of days for construction of an affordable home had come down from 314 days in FY16, to just 114 days as on date.
“81 lakh low-income houses with an investment of Rs 4.83 lakh crores have been sanctioned, and construction has already started on 43 lakh of these houses,” said Sitharaman, adding that new construction technology had been applied towards 13 lakh of these homes.
In an apparent move to spur home-buying in the sub Rs 45-lakh category (regarded as ‘affordable’), the finance minister announced that buyers would get an extra deduction of Rs 1.5 lakh on interest paid towards loans taken on these homes. In all, the total interest deduction for sub Rs 45-lakh homes now stands at Rs 3.5 lakhs — for loans taken up until March 31, 2020.
In a move that the government hopes will revive the real estate sector, Nirmala Sitharaman announced that the government-owned land parcels would be utilised for infrastructure development. Her budget speech added that a new Model Tenancy Law would be drafted and circulated to all states.
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