What is MHADA? How Does It Benefit Home Buyers

For a long time, the state of Maharashtra was sinking below the weight of rising living and accommodation costs. As a result, many were deprived of a standard of living basic to a dignified human existence. The Maharashtrian Government intervened with the MHADA Lottery scheme to tackle this problem. Let’s find out what exactly the MHADA is and how home buyers can benefit from its lottery scheme.

What is MHADA?

Established in the year 1977 under the Maharashtra Housing and Area Development Act of 1976, the MHADA or Maharashtra Housing and Area Development Authority (also known as the Bombay Housing Board) is the body responsible for the construction of residential houses under different housing schemes for various societal segments.

The first ever low-cost housing scheme provided by MHADA was introduced in 2012 where 2593 apartments in Mumbai were offered via a lottery draw system. Ever since then, similar schemes have been announced. Under the MHADA lottery scheme, low-cost housing units are granted in specified areas each year to people belonging to the EWS (Economically Weaker Section), LIG (Low-Income Groups), MIG (Middle-Income Groups), and HIG (High-Income Groups) via a lottery draw system.

Additional Read: Home Loan in Mumbai

How does MHADA benefit Home Buyers?

The MHADA offers several benefits for home buyers:

– Affordable housing: MHADA offers housing that fits various budget levels, ensuring people from different income groups, like low and middle-income households, have access to affordable homeownership opportunities.

– Fair and transparent allocation: MHADA follows a clear and open system, where homes are assigned through a public lottery. This process ensures that everyone has an equal chance of securing a property.

– Financial assistance options: MHADA provides financial support, such as reduced interest rates on loans and flexible repayment options, easing the process for buyers to secure home financing.

– Lower-cost housing: Homes offered by MHADA are priced lower than the market value, making it easier for individuals, especially from underprivileged backgrounds, to afford a property.

– Legal protection: Homes bought through MHADA are backed by government regulations, offering legal security and reducing the chances of disputes, providing buyers with peace of mind.

– Infrastructure development: Along with residential units, MHADA ensures the development of essential infrastructure like roads, water systems, and sanitation facilities.

– Improvement of slums: Through redevelopment initiatives, MHADA transforms slum areas into well-organized, improved residential spaces with better infrastructure, ensuring a higher living standard.

– Potential for property value growth: Properties developed by MHADA are often situated in well-connected areas with good infrastructure, increasing their potential for future value appreciation.

Objectives of MHADA

Since the whole of Maharashtra in general and Mumbai in particular, had a reputation for being highly expensive in terms of living and accommodation, the MHADA lottery scheme was introduced to make housing affordable for all income groups, especially those belonging to EWS and LIG segments of the society. The scheme allows people to buy properties in the most sought-after localities of Mumbai and Pune at costs that are much lower than that offered by private builders.

What are the Specifications under MHADA?

Every year, the MHADA allots a certain number of housing units for each income group of the society. This number varies each year and the EWS and LIG segments generally hold a higher share as compared to MIG and HIG sections.

The MHADA has also pre-set the price range of the residential units for each income group. All EWS housing units are priced under Rs. 20 lakhs; all LIG flats range between Rs. 20-30 lakhs, all MIG houses cost between Rs. 35-60 lakhs, whereas all HIG flats are priced between Rs. 60 lakhs to Rs. 5.8 crore.

Which Areas are covered under MHADA?

The MHADA scheme is applicable only in certain specified areas such as Andheri, Chandivali, Goregaon, Chembur, Borivali, Ghatkopar, Kandiwali, Dahisar, Jogeshwari, Kurla, Korekalyan Santacruz, Malad, Mankhurd, Powan, Sion, Wadala, and Mulund. One can apply for the lottery scheme by simply registering online in three easy steps provided they are eligible as per the eligibility criteria laid out by the MHADA.

Are you eligible for the MHADA lottery scheme? If yes, you have easy home loan options to cover your housing needs with Tata Capital Housing Finance Institution. You can avail of home loan from Rs. 2,00,000 to Rs. 5,00,00,000 for a tenure of 30 years with home loan interest rates starting at just 9.25%! Simply check out your home loan eligibility using Tata Capital’s home loan eligibility calculator online and apply for your housing loan today.