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Letters: Pricey housing scheme

This means builders will make hefty profits under PMAY

A Sathyanarayana  |  New Delhi 

While the government had introduced the Pradhan Mantri Awas Yojana (PMAY) with much fanfare, it seems the scheme is now unaffordable for the poor and low-income group. 

Builders are re-labelling their projects as affordable housing under PMAY with the earlier price tag, although these projects are also available outside the umbrella of the scheme. In some cases, they are charging high rates even for 30-square-metre and 60-square-metre units. The scheme has ended up providing only interest subsidy to buyers. Builders are asking for five per cent to 10 per cent down payment and no EMI until possession. These are the same terms and conditions under which flats are available outside PMAY.  

This means builders will make hefty profits under PMAY. There is no price cap or checkmate, builders are not passing the zero-tax exemption on profits earned under the scheme to buyers. Likewise, associated benefits under infrastructure status for PMAY are also not being passed to customers.  

The government should immediately plug loopholes in the scheme by imposing a price cap and also define the facilities that are supposed to be available in affordable housing units. It should set the conditions for construction, materials to be used and amenities to be provided in each unit and ensure compliance with the strictest building standards. 

The government should ask builders to consider the possibility of converting unsold inventory into affordable 30-square-metre or 60-square-metre units and make them ready-to-move-in flats. Effort should be made to reduce cost and introduce deadlines for completion of these units. 

If prices are high, how can the scheme be successful only with a small subsidy by way of an interest cut against a loan granted?

A Sathyanarayana   New Delhi
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