Affordable Rental Housing Scheme

Affordable Rental Housing Complexes (ARHCs) as a Sub-scheme under Pradhan Mantri Awas Yojana- Urban (PMAY-U) to provide affordable rental housing to urban migrants/ poor close to their workplace. The sub scheme aims to create a conducive ecosystem for Public/ Private Entities to leverage investment in rental housing.

Why is the sub-scheme necessary?

ARHCs is required due to the following reasons:

• Large scale reverse migration of urban migrants/ poor due to COVID-19.
• Urban migrants stay in slums/ informal settlements/ unauthorised colonies/ peri-urban areas to save cost on housing.
• Non availability of housing close to workplace adversely impacts productivity.
• Requirement of affordable rental housing rather than ownership

Who are the beneficiaries for ARHCs?

Beneficiaries for ARHCs are urban migrants/ poor from EWS/ LIG categories. ARHCs will be a mix of single/double bedroom Dwelling Units and Dormitory of 4/6 beds including all common facilities which will be exclusively used for rental housing for a minimum period of 25 years.

These complexes will ensure a dignified living environment for urban migrants/poor close to their workplaces at affordable rates. This will unlock existing vacant housing stock and make them available in urban space. It will propel new investment opportunities and promote entrepreneurship in rental housing sector by encouraging Private/Public Entities to efficiently utilize their vacant land available for developing ARHCs.

How will the ARHC scheme be implemented?

The ARHC scheme will be implemented through two models:

• Utilizing existing Government funded vacant houses to convert into ARHCs through Public Private Partnership or by Public Agencies
• Construction, Operation and Maintenance of ARHCs by Public/ Private Entities on their own vacant land

Process flow of Model 1

• Inventory of Vacant houses
• City wise fixation of affordable rent
• Issuance of RFP
• Submission of proposal
• Financial evaluation
• Selection of concessionaire
• SLAC/SLSMC approval
• Handover of site to concessionaire
• Commencement of work

Process flow of Model 2

• Eol Issuance
• Submission of Application
• Technical Evaluation
• Submission of DPR
• SLSMC/CSMC approval
• Statutory approvals
• Commencement of work

Where will the sub-scheme be implemented?

It is to be implemented in all statutory towns, notified planning areas and areas under Special Area/ Development Authorities/ Industrial Development Authorities.

Note: ARHCs will be considered till March 2022.

Benefits of ARHCs

• Decent living environment for Urban Migrants/Poor
• Effective Utilisation of Vacant Land by Private/Public Entities
• Promoting new Investment opportunity & entrepreneurship
• Strengthening of Municipal Finances
• Sustained workforce and Increased productivity
• Economically Productive use of Govt. funded houses.

Incentives Proposed for Private/Public Entities:

• By Central Government
  • Technology Innovation Grant (TIG) for promoting use of innovative technology
  • Concessional project finance under Affordable Housing Fund (AHF) and Prority Sector Lending (PSL)
  • Exemption in Income Tax and GST on any profit and gains from ARHCS
• By States/ULBs/Uts
  • 50 percent additional FAR/FSI, free of cost
  • Statutory approval through single window system within 30 days
  • Municipal charges at par with residential property
  • Trunk infrastructure upto project site
  • Use permission changes, if needed.