Extension of CLSS scheme and its impact on affordable housing

The Pradhan Mantri Awas Yojana (Urban) extension till December 31, 2024 has been accepted by the Union Cabinet. The programme to provide the rewards for affordable housing was first announced in 2015, and its original time frame was March 2022. It began with the objective of providing housing for every person by 2022.
 
One of the four pillars of the Pradhan Mantri Awas Yojana-Urban (PMAY-U) is the Credit Linked Subsidy Scheme (CLSS), which gives interest subsidies on housing loans taken by related persons of the Financially Weaker Section (EWS) and Low-Income Group (LIG) for the purpose of purchasing or repurchasing homes.
 
The Economically Weaker Section (EWS), Low Income Group (LIG), and Medium Income Group (MIG) can get home loans at reduced EMIs with the support of an interest payment under this programme, which is a benefit provided under the PMAY Scheme. The recipient will get an early credit for the interest subsidy on the principal balance, which would lower the actual home loan and EMI.
 
The Credit Linked Subsidy Scheme (CLSS) under PMAY makes the loan affordable by giving a discount on the worth considerably, thus lowers the customer's outflow on the loan. The size of the housing unit being funded and the customer's income category are the two primary factors that influence the value under the scheme.
 
Pradeep Aggarwal, Chairman and whole-time director, Signature Global (India) Ltd said, “The continuation of Pradhan Mantri Awas Yojna (Urban) till 2024 will surely be a major boost to uplift the sentiments of the consumers. Government is committed towards the housing for all mission and we are confident that it will continue to help the end user in buying their dream home through bringing some incentives and schemes. Overall, this would bring in more positivity and multiplier effect in the entire real estate industry and each stakeholder.”
 
Kushagr Ansal, Director Ansal Housing said, “The announcement of the extension of CLSS comes at a time when the country is coming out of the throes of the pandemic. It is a much-needed step especially when the real estate is picking up pace and the budget housing is getting away from the reach of the masses due to various factors such as gradual increase in housing prices and hike in interest rates by the RBI. We are sure that this move will bring affordability to the housing sector and help the common man realise his dreams.”
 
Ashwani Kumar, Pyramid Infratech said, “Pradhan Mantri Awas Yojna (Urban) has been a gamechanger in real estate development and enabled many families to realise their dream of a first home. However, the pandemic turned out to be a dampener as a result its intended benefits could not be as widespread as it was intended to. The extension of this scheme till 2024 is a laudable move in this direction and will provide a big thrust to the affordable housing segment.”