Maharashtra Tightens Rules for PMAY-Urban 2.0 Affordable Housing Projects

The Maharashtra government has tightened rules for affordable housing projects under the Pradhan Mantri Awas Yojana (Urban) 2.0 to bring more clarity, fairness, and accountability in pricing and approvals.

The new rules make it compulsory for developers to link beneficiaries early in the project, especially in cases where the price of homes meant for the economically weaker section (EWS) is higher than usual.

25% beneficiary link made compulsory

Under the revised norms, developers will have to register beneficiaries for at least 25% of the total units before starting construction or receiving scheme benefits in certain affordable housing projects.

This rule will apply to projects under Affordable Housing in Partnership (AHP) and AHP–public private partnership (AHP-PPP) categories, where the sale price of EWS homes exceeds the prevailing annual statement of rates (ASR) by more than 20%.

For AHP projects, beneficiary registration must be completed for at least 25% of the units before physical construction begins.
For AHP-PPP projects, beneficiary attachment will be mandatory before granting additional floor space index (FSI) or extending any other benefits under PMAY (Urban) 2.0.
Such proposals will also have to be resubmitted to the state-level project management unit after beneficiaries are linked.

Why the government changed the rules

The revised guidelines, issued on January 23, came after the government reviewed detailed project reports (DPRs) submitted under PMAY (Urban) 2.0.

The review found differences in EWS pricing, variations in how built-up areas were calculated, and missing or unclear documentation in several projects.

Following directions from the State Level Appraisal Committee (SLAC) during meetings held in August and October 2025, the state decided to issue standard rules to ensure uniformity in project approvals.

Clear limits on flat size

The new guidelines also fix clear norms for the size of EWS homes. The built-up area of EWS units cannot be more than 1.4 times the carpet area. This limit will be used while filling project details and calculating sale prices.

The government said this step was needed because earlier submissions showed wide differences in how unit sizes were calculated.

Approvals required at proposal stage itself

To further tighten compliance, the housing department has made it mandatory for all implementing agencies to submit key no-objection certificates (NOCs) at the proposal stage itself.
These include approvals for water supply, sewerage, and electricity from the concerned municipal corporations, councils, utilities, or authorised agencies. Officials noted that many earlier proposals had either skipped these clearances or said they would be submitted later.

No liability on state for unsold homes

The circular also clearly states that the state government will not be responsible for unsold or vacant units after completion of PMAY (Urban) 2.0 projects. The commercial risk will remain with the implementing agencies.

All authorities implementing PMAY (Urban) 2.0 projects have been directed to strictly follow the revised guidelines while submitting proposals.

With these changes, the state aims to ensure that affordable housing projects are planned more carefully, priced fairly, and backed by real beneficiaries from the start. While developers may face tighter checks, the move is expected to improve transparency and protect the interests of genuine homebuyers.

By Sana Khan
Executive Editor, Realty Quarter