Budget Reaction – Vihang Sarnaik, Director, Vihang Group

“A critical facet of my expectation from the Budget was the re-evaluation of affordable housing criteria. I was expecting that the Honourable Finance Minister would find some merit in establishing a separate affordable housing index for each Tier-1 and Tier-2 cities with impetus to the housing affordability in key Metro Cities and its Periphery. 

While considering the affordability of housing, it was essential to consider factors such as inflation, land cost, construction cost, approval cost, and labour cost for defining affordability in housing. For instance, in the case of Mumbai, where housing costs are notably high, we thought that the interim  Budget would increase the price ceiling on affordable housing from ₹45 lakhs to ₹90 lakhs so that the whole affordable scheme benefits a large chunk of people living in the unorganised sector. 

As per the current affordable housing scheme, the limit is set at ₹45 lakhs and you will not find a single home in Mumbai in that price bracket. So, the scope of availing the full benefit of credit link subsidy under PMAY is non-existent in Mumbai.