What is Affordable housing?
Affordable housing refers to housing units that are affordable by that section of society whose income is below the median household income.
Many countries have different definitions for affordable housing, but it is largely the same, i.e. affordable housing should address the housing needs of the lower or middle income households. Affordable housing becomes a key issue especially in developing nations where a majority of the population isn’t able to buy houses at the market price.
Disposable income of the people always remains the primary factor in determining the affordability. Automatically as a result, it becomes the increased responsibility of the government to cater to the rising demand for affordable housing.
The Government of India has taken various measures to meet the increased demand for affordable housing along with some developers and in some cases have stressing on public-private partnerships (PPP) for development of these units.
Schemes and programs for affordable housing from the Government of India
- Pradhan Mantri Awas Yojana-Urban (PMAY-U): Launched in 2015, this scheme aims to provide affordable housing to the urban poor by the year 2022. The scheme provides financial assistance to beneficiaries in the form of interest subsidy and credit-linked subsidy.
- Pradhan Mantri Awas Yojana-Gramin (PMAY-G): Launched in 2016, this scheme aims to provide affordable housing to the rural poor. The scheme provides financial assistance to beneficiaries in the form of a grant, which is used for construction or renovation of their houses.
- Affordable Rental Housing Complexes (ARHCs): Launched in 2020, this scheme aims to provide affordable rental housing to urban migrants and the poor. The scheme provides financial assistance to private and public entities for the construction of rental housing complexes.
- Credit-Linked Subsidy Scheme (CLSS): This scheme provides interest subsidy on home loans for eligible beneficiaries under the PMAY-U and PMAY-G schemes.
- National Urban Housing Fund (NUHF): Launched in 2018, this scheme provides funds for affordable housing projects in urban areas. The scheme is meant to provide long-term loans to government agencies and private entities for the construction of affordable housing.