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Pradhan Mantri Awas Yojana 2021-22: Know every information about affordable rent housing in India

On 10,Feb. 2021, the Ministry of Urban and Housing Development confirmed that the Affordable Rental Housing Complex (ARHC) scheme has received the green signal from the Union Cabinet and is a sub-scheme of the Pradhan Mantri Awas Yojana (Urban). Will continue Its purpose is to provide better living standards to the poor living in the city.

On 10,Feb. 2021, the Ministry of Urban and Housing Development confirmed that the Affordable Rental Housing Complex (ARHC) scheme has received the green signal from the Union Cabinet and as a sub-scheme of the Prime Minister Housing Scheme (Urban) Will continue Its purpose is to provide better living standards to the poor living in the city. The last few years have witnessed a period of steady decline in Indian real estate. In such a situation, rental housing was a topic of discussion among industry leaders, developers and analysts alike. The United States and Singapore are examples of developed countries, where the rental housing market has flourished rapidly over the past few years. A large number of people are choosing this.

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Earlier India found it difficult to resort to the rental housing model, which at one time was more beneficial for stakeholders to stabilize housing demand? In this article, we will tell you about the development of PMAY, Rental Housing Scheme in India (known as ARHC or Affordable Rental Housing Complex), its components and scope.

Development of Rental Housing in India

However in July 2020 ARHC formally came into existence. But the 2015 National Urban Housing Rental Policy (Draft) 2015 had shown some interest in the past. The need to address the housing needs of the urban poor was on the anvil, but failed to address it due to various reasons.

The National Urban Housing Rental Policy can also be traced back 32 years till the National Housing Policy, 1988. When the need for rental accommodation was first discussed. Over the next three decades, the proposal failed to attract attention.

Types of Rental Housing in India

There are several types of rental housing. Note that Dharamshala, hotels and lodges are not included in rental housing. There are others and you must have seen such formats in India.

Types of Rental Housing How does it work
Formal rental housing Registered Rent Agreement between
Landlord and Tenant.
Informal Rental Housing There is no agreement
between the
tenant and the landlord.
Market driven rental accommodation Managed by himself without assistance
from the government
Commercial or need-based rental accommodation Tenants may or may not be able to pay
But the source of his income
and his job demand is that he stay with his company. 
workers as an example.
Public Rental Housing Government institution or authority has
authority over it.
Social rental housing Its owner can be any NGO, public or private company, which rents the property at rates
lower than the market.


Affordable rent housing scheme

In May 2020, it was proposed that the Affordable Rental Housing Complex Scheme (ARHC) would be launched as a public-private partnership model. The scheme focuses on migrant workers, students and the urban poor, so that they can be given accommodation and security through government-funded housing. The scheme will be under PPP mode and Industries, Manufacturing Units and Institutions can be encouraged to develop ARHC on unused land. Such properties are expected to prevent migrant workers from visiting their native places in the event of a disaster like Kovid-19. The Ministry has issued guidelines regarding this.

Durga Shankar Mishra, Secretary, Ministry of Housing and Urban Development (MoHUA), confirmed that the ARHC scheme has been approved by the Union Cabinet on 8 July 2020. For this purpose, government-aided housing complexes will be used and will be converted into ARHC after a concession agreement is signed for 25 years. MoUHA claimed that this is a step towards self-reliant India. The ministry hopes to curb the spread of slums and provide a better environment for those who cannot afford it.

Under the visionary leadership of Hon’ble Prime Minister @narendramodi ji, the Union Cabinet approved the Affordable Rental Housing Complex Scheme to create an urban ecosystem to provide affordable rental accommodation to urban migrants / poor.

Where will ARHC apply?

ARHC is a sub-plan of PMAY and the Ministry of Urban Development confirmed that the scheme will be applicable in these areas: –

Constitutional cities –

Planning areas which have been notified.

– Development Authority –

Special Area Development Authority –

Any other field which can be notified by the State or Union Territory Government.

Model to implement ARHC

It has two models. The first government-aided land, which is lying vacant and will be converted into ARHC under public agencies and PPP model. The second model is one that includes construction, operation and maintenance of ARHC and will be built by public or private companies on their vacant land.

List of beneficiaries in ARHC

– Laborers –

Urban poor such as street vendors and hawkers –

Markets and trade associations –

Industrial workers –

Manufacturing units –

Long term tourists –

Hospitality sector –

Education institutions –

Students –

Health institutions

New progress in ARHC:

The government has issued clear guidelines regarding ARHC. Let us tell you about it.

Time period: Projects under ARHC will be used for rental housing for at least 25 years.

Size of the units: The size of single bedroom units will be up to 30 square meters and the size of double bedroom units will be up to 60 square meters. Beds in the dormitory will each have up to 10 square meters of carpet area.

Initial fare: According to the guidelines of the Urban Development Ministry the initial fare will be decided by the local administration. The guidelines also say that where the rent for government aided flats on the outskirts of Delhi can be Rs 3,000. At the same time, the same amount can also be fixed for units in Agra, Ernakulam, Faridabad and Ludhiana. So far 1.08 lakh houses have been completed and are ready for rent. We are waiting for more information.

FDI in Affordable Rental Housing Scheme: Union Minister Hardeep Singh Puri said that 100 percent FDI in rental housing will be announced soon.

Priority of housing rent: Priority will be given in the allocation of economically and socially backward classes, widows, disabled and working women in the society.

Important points of ARHC scheme

-ARHC scheme is applicable only till March 2022, which is also PMAY urban mission period. All related funding and ideas will be applicable till then.

– Projects under ARHC will be used for rental housing purposes only, for a minimum period of 25 years.

PMAY Subsidy Scheme Extension

One of the relevant questions so far is whether the central government will announce a PMAY subsidy scheme and extend the last date of PMAY credit-linked subsidy scheme (CLSS) for middle income groups I and II. The last date for availing the subsidy for this segment was 31 March 2020, while the Economically Weaker Section (EWS) and Lower-Income Group (LIG) had time till 31 March 2022.

Finance Minister Nirmala Sitharaman had announced on May 14 that the scheme would be extended to FY2021. Through this, the target is to invest Rs 70,000 crore in housing projects for the middle income group.

Considering that the objective of Housing for All is the main reason behind the PMAY scheme by 2022, experts had already said that the central government would be keen to increase it. Now, an additional 2.5 lakh beneficiaries will benefit from the expansion.

In a nutshell, whose income is between 6 to 12 lakhs is MIG-1 and subsidy will be given in the interest of 4 percent up to Rs. 9 lakhs in the loan amount. For those whose income is between 12 to 18 lakhs, MIG-II is. On this, up to 3 percent interest subsidy will be given on the loan amount up to 9 lakh. These are the guidelines till now. The PMAY CLSS subsidy amount is 2,35,068 for MIG-I and 2,30,156 for MIG-II and the beneficiaries can continue to take advantage of it.

Scope and challenges of ARHC:

The government’s initiative to provide better lifestyle to the poor has not been good for the real estate fraternity. Ankush Call, President (Sales and Marketing), Ambience Group, said, “Cabinet approval for ARHC is a step that will strengthen the government’s commitment to Housing for All.” If implemented, affordable housing will be constructed for people who are not in a position to buy a house. Apart from this, it will also solve the problem of affordable housing in cities.

However, Kaul also said that the availability of land and the necessary infrastructure to build it can pose a challenge.

Another challenge, which many experts are talking about, is that there is little enthusiasm among private partners about ARHC, as the profit may be less. There is no use for developers who have land limited to cities only. Only time will tell if the government’s incentives and concessions include 50 percent additional FAR / FSI, tax rebate, concessional loan at priority sector loan rate for affordable housing to develop ARHC on their vacant land for 25 years. And can be extended beyond private developers.

Parvesh Maurya
Parvesh Maurya
Parvesh Maurya, has 5 years of experience in writing Finance Content, Entertainment news, Cricket and more. He has done BA in English. He loves to Play Sports and read books in free time. In case of any complain or feedback, please contact me @
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