Budget 2025: Pradhan Mantri Awas Yojana's role in reviving affordable housing gains spotlight

The Pradhan Mantri Awas Yojana (PMAY-Urban), launched in mid-2015, has steadily progressed in providing affordable housing across India. Experts suggest that adopting adaptable, sustainable, and low-cost construction technologies could accelerate the development of large-scale housing projects.

According to the Ministry of Housing and Urban Affairs, as of January 20, 2025, 118.64 lakh homes have been sanctioned, with 90.22 lakh units completed and 112.50 lakh units grounded. Financially, nearly Rs 200,000 crore in central assistance has been committed to the scheme.

"PMAY must be made accessible to more people, and awareness about it also needs a big shot in the arm," said Anuj Puri, Chairman of the Anarock Group.

A significant aspect of PMAY is the interest subsidy on home loans and direct subsidies for individual house construction or enhancement. With the Union Budget 2025-26 just around the corner, the programme is expected to receive renewed focus.

“Creative solutions and strong political will can bring this vitally important programme back to centre stage, which is where it belongs,” Puri added.

Affordable Housing: A Segment in Transition

Amid rising property prices, the luxury housing market is witnessing a slowdown. This shift may present an opportunity for affordable housing units priced under Rs 40 lakh to regain traction.

Any significant announcements in the upcoming Union Budget for the affordable housing segment could bolster demand and provide much-needed momentum, the report highlighted.

"Even if such measures don't initiate a full-blown revival, they can at least improve this segment's overall prospects. A healthy housing market caters to a broad range of buyers and doesn't favour just one segment," Puri explained.

Post-Pandemic Housing Demand Evolving

The pandemic has redefined housing preferences in India. Buyers are now seeking larger, multi-functional homes equipped with a comprehensive range of lifestyle amenities. Affordable housing projects that align with these changing preferences may find increased demand in the coming years.

The Union Budget 2025-26 will play a crucial role in shaping the future of affordable housing, with PMAY expected to remain a central focus.