Why millennials should be taking advantage of the PMAY scheme

Each generation of individuals shows a different direction and inclination towards different economic trends and changes. This is no different for the individuals of Generation Y, commonly known as the millennials. These individuals are within the age group of 18 to 30’s, a time where they first begin to earn to the time they are earning in peak. These individuals have a distinctive use and familiarity with economic understanding and execution along with the different trends of digital technology.

According to research, at least 82% of the millennials in India focus on investing in real estate as a sound investment in the near future. However, due to the high cost of real estate, 23% of these individuals reside with their parents, until they have sufficient savings to make their own investment. These individuals are more likely to move out of their family homes within the next 2 to 5 years. However, by 2020 at least 65% of these individuals will be under the age of 35. But at the same time, at least 65% of millennials are aspiring to invest in real estate property that matches their current lifestyle.

As one can see, most of the millennials have the priority to purchase or invest in real estate property somewhere in their future. However, due to the fact that real estate prices are on the high side, it makes it difficult for such individuals to invest. To compensate for such high prices, these individuals live with their parents until they able to invest in their own properties, normally at the age of 35 years.
To provide financial relief for these individuals, the government has come up with a credit linked subsidy scheme that makes it easier to purchase a home at affordable pricing. Under this scheme, also known as ‘Pradhan MantriAwasYojana’, the government intent to follow the goal of ‘Housing For All by 2022’.

How can millennials take advantage of the PMAY scheme for their home purchase?

To encourage the millennials to invest in real estate, this credit linked subsidy scheme is amended to include any adult earning member, whether married or unmarried, as a as a separate householder who does not own a fixed house. It also includes married couples to invest in homes, under an individual or joint scheme Under this scheme, these individuals can invest in real estate through a home loan and get several benefits.

They include the following:

·Interest subsidy of 4% for loans up to Rs. 9 Lakhs earning a household income of up to Rs. 12 lakhs.

·Interest subsidy of 3% for loans up to Rs. 12 Lakhs earning a household income of Rs. 18 lakhs.

·The outcome of the benefits include in the range of Rs. 2 lakhs to Rs. 2.5 lakhs.