Subsidies for home loan announced by PM Narendra Modi under Pradhan Mantri Awas Yojna (PMAY), on 31st December 2016, will now come in to play. Government has unveiled two new home loan subsidies’ slabs in order to give a thrust to “Housing for All by 2022” proposal and to lift the real estate market. The subsidy is to be claimed on home loans with tenure of up to 20 years, against the 15-year tenure at present.
People who are earning up to ₹6 Lakh can claim the subsidy of 6.5 percentage points on home loan interest up to ₹6 Lakh. If the home loan interest comes out to be 9%, the claimer will have to pay 2.5% of interest up to ₹6 Lakh and 9% on the rest of the amount.
For the other slab, which covers the income of up to ₹12 Lakh, the subsidy on home loan is decided as 4 percentage points for up to ₹9 Lakh.
Third home loan subsidy slab will cover the individuals with ₹18 Lakh per annum income under which 3 percentage points of subsidy on principal component of up to ₹12 Lakh will be granted. The subsidy on home loan so granted are regardless of the amount of home loan.
An individual under the income category of ₹18 Lakh can buy his or her first house at cost ₹2.4 Lakh less. On an average, the individuals under all three categories will get the exemption of around ₹2.4 Lakh on their respective home loans. (See Table Above).
The nodal agencies operating the subsidy schemes at present are – NHB (National Housing Bank) and HUDCO. 18,000 first home buyers under the scheme for low-income group are being subsidised at a cost of around ₹310 Crore. The disbursal rate is most likely to rise due to the inclusion of middle-income category under the scheme.
This is to be noted down that the subsidy on home loan under PMAY is in addition to the tax benefits on home loan and may reach ₹61,800 per annum for an individual in the 30-percent tax bracket.
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