Affordable Housing for All

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Affordable housing refers to housing units that are affordable for those with income below the average household income. In India, affordable housing is provided for low income people, middle income people and economically weaker sections who have considerably low levels of income (urban areas).

The government has set 2022 as the target year to realize this objective by making specific initiatives for the promotion of housing. Two components under Pradhan Mantri Awas Yojana – the PMAY (Urban) and PMAY (Rural) were launched by the government for achieving housing for all by 2022.


  • Affordable housing helps in human development by raising life-expectancy, reducing disaster vulnerability, creating a better environment for a child’s education and homework, women empowerment etc.
  • Affordable housing generates further demand for Government schemes for LPG connections, toilets and electricity. This further reduces the miseries of poor women.
  • Urban local bodies can eventually impose property tax on such affordable houses and use the money for public welfare.
  • Affordable housing helps in Economic Development.
  • As per the Report of the Technical Group on Estimation of Urban Housing Shortage (2012), there is a huge gap in demand and supply of urban housing both in the urban and rural areas.
  • According to the Technical Group Report, two low income categories – economically weaker sections (EWS) and low-income groups (LIG) accounted for 96% of the total housing shortage in India.
  • Given the need for houses and increasing trend of urbanisation, housing facilities in urban areas has to be expanded. With the current progress of urbanisation, around 40% of the country’s population is expected to live in urban areas by 2030.


  • Affordable housing in rural and urban housing sector need differently tailored policies as land is the main constraint in the urban areas.
  • According to the data from Ministry of Housing and Urban Poverty Alleviation, there is a shortage of 18.78 million housing units, of these the Economic and weaker section (EWS) alone accounts 56.2 percent.
  • It is evident that there is a mismatch in the demand and supply in the housing market, as the Census of India shows that 11.07 million houses were vacant in 2011 in Urban India. Housing Surplus is in the higher income groups while 95% of the deficit is in the Economically Weaker Section (EWS) and Lower Income Group (LIG) categories.
  • According to the estimates, India’s urban population is expected to grow to 814 million by 2020. This will pose a major challenge in providing housing facilities and basic amenities to the population. This may result in growth of the homeless population.
  • Scarcity of developed and encumbrance free land, increased cost of construction, lack of private sector participation, absence of viable rental market, inaccessibility to home loans by poor are some of the challenges which need to be addressed for development of the affordable housing market.
  • Technological Innovations in low cost building material and construction practices lack popular acceptance in the market.
  • Certain regulatory constraints such as long and cumbersome approval process, environment clearance, lack of clarity in building by-laws and implementation of the master plan.
  • The housing shortage for 2012-17 is estimated to be 18.78 million units in rural areas.


  • Capacity building for all players at different levels is an important prerequisite to achieve housing for all by 2022.
  • States have an important role to play as ‘housing and urban development’ is a state subject. States must prepare a comprehensive housing plan articulating the institutional and legal structures for enabling ecosystem to achieve this ambitious task.
  • Innovation in the housing sector need focused attention, where practices of low cost housing and rapid paced construction technology can be incorporated.

Pradhan Mantri Awas Yojana –  PMAY (Urban)

At the slum decadal growth rate of 34%, the slum households are projected to go upto 18 million. 2 million non-slum urban poor households are proposed to be covered under the Mission. Hence, total housing shortage envisaged to be addressed through the new mission is 20 million.

The Mission is being implemented during 2015-2022 and provides central assistance to Urban Local Bodies (ULBs) and other implementing agencies through States/UTs for:

  • In-situ Rehabilitation of existing slum dwellers using land as a resource through private participation
  • Credit Linked Subsidy
  • Affordable Housing in Partnership
  • Subsidy for beneficiary-led individual house construction/enhancement.

Credit linked subsidy component is being implemented as a Central Sector Scheme while other three components as Centrally Sponsored Scheme (CSS).

All statutory towns as per Census 2011 and towns notified subsequently would be eligible for coverage under the Mission.

In the spirit of cooperative federalism, mission provides flexibility to the States for choosing the best options amongst four verticals of mission to meet the demand of housing in their states. Process of project formulation and approval in accordance with the mission Guidelines has been left to the States so that projects can be formulated, approved and implemented faster

A Technology Sub-Mission under the Mission has been set up to facilitate adoption of modern, innovative and green technologies and building material for faster and quality construction of houses. Technology Sub-Mission also facilitates preparation and adoption of layout designs and building plans suitable for various geo-climatic zones. It will also assist States/Cities in deploying disaster resistant and environment friendly technologies.


Pradhan Mantri Awaas Yojana – PMAY (Gramin)


Housing is one of the basic requirements for human survival. For a normal citizen owning a house provides significant economic and social security and status in society. For a shelter less person, a house brings about a profound social change in his existence, endowing him with an identity, thus integrating him with his immediate social milieu.

In pursuance to the goal – Housing for all by 2022, the rural housing scheme Indira Awas Yojana has been revamped to Pradhan Mantri Awaas Yojana – Gramin and approved during March 2016. Under the scheme, financial assistance is provided for construction of pucca house to all houseless and households living in dilapidated houses. It is proposed that one crore households would be provided assistance for construction of pucca house under the project during the period from 2016-17 to 2018-19. The scheme would be implemented in rural areas throughout India except Delhi and Chandigarh. The cost of houses would be shared between Centre and States.


To provide pucca house to all who are houseless and living in dilapidated houses in rural areas by 2022.

Funding Pattern

  • Under PMAY, the cost of unit assistance is to be shared between Central and State Governments in the ratio 60:40 in plain areas and 90:10 for North Eastern and hilly states.
  • The unit assistance given to beneficiaries under the programme is Rs 1,20,000 in plain areas and to Rs 1,30,000 in hilly states/difficult areas /Integrated Action Plan (IAP) for Selected Tribal and Backward Districts. Presently the NE States, States of HP, J&K and Uttarakhand and all 82 LWE districts are identified as difficult and hilly areas. The unit size is 25 sq.m including a dedicated area for hygienic cooking.
  • The beneficiary is entitled to 90 days of unskilled labour from MGNREGA.
  • The beneficiary would be facilitated to avail loan of up to Rs.70,000/- for construction of the house which is optional.
  • Funds will be transferred electronically directly to the account of the beneficiary.

Target Group

Identification of beneficiaries eligible for assistance and their prioritisation to be done using information from Socio Economic and Caste Census (SECC) ensuring total transparency and objectivity. The list will be presented to Gram Sabha to identify beneficiaries who have been assisted before or who have become ineligible due to other reasons. The finalised list will be published. Annual list of beneficiaries will be identified from the total list through participatory process by the Gram Sabha. Gram Sabha will need to justify in writing with reasons for any alteration of priority in the original list.

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