According to an ICRA report, demand for affordable homes is set to stay healthy, with the market poised to touch the Rs 6.25 lakh crore mark by 2022, supported by a growing population, young demographic profile, shift towards nuclear families and rapid urbanisation.
Limited supply in low cost and affordable housing segments, largely being catered to by the government undertakings or the smaller and unorganised developers, has resulted in an acute shortage of housing. Various incentives to home buyers targeted at the affordable housing segment are expected to further augment the demand, according to ICRA.
Some of the incentives include credit-linked subsidy for housing loans for the economically weaker section (EWS) and the low income group (LIG) under the Pradhan Mantri Awas Yojana (PMAY) and the additional income tax deduction for interest on home loans of up to Rs 35 lakh. The government has recently introduced interest subsidy of 3 per cent and 4 per cent on home loans of up to Rs 9 lakh and Rs 12 lakh, respectively, under the PMAY