If person earns up to Rs 18 lakh p.a, so buying his first house will cost about Rs 2.4 lakh less as the government is going to subsidise a part of the home loan interest. At present, this subsidy is available to only those earning up to Rs 6 lakh p.a.
The government has declared two new subsidy slabs to offshoot the real estate market and attain housing for all by 2022. The slabs will apply to loans with a tenure of up to 20 years, as against the limit, which was 15 years now.
Home buyers will get subsidy at different rates subjected to the income bracket they are in. People earning less than Rs 6 lakh per annum will get a subsidy of 6.5% points on a principal component of Rs 6 lakh, regardless of their total loan amount. If they borrow money at 9% interest, they would have to pay only 2.5% interest on Rs 6 lakh, and 9% on the remainder.
In the next bracket, people earning up to Rs 12 lakh p.a. will get an interest subsidy of 4% points on a principal basic of Rs 9 lakh, and for the highest income category of Rs 18 lakh pa. will get a subsidy of 3% points on a principal component of Rs 12 lakh.
HUDCO and National Housing Bank (NHB) are the nodal agencies to implement the subsidy schemes.