The circular, numbered PraAyo-2025/Pra.Kra.194/GruNidho-2 and issued from Mantralaya, Mumbai on 23 January 2026, follows a review of DPRs received under the scheme, which revealed a lack of uniformity in EWS unit pricing, built-up area calculations, and the No-Objection Certificates (NOCs) being obtained for construction. The decision draws on discussions at the third and fourth meetings of the State Level Appraisal Committee (SLAC), held on 11 August 2025 and 1 October 2025 respectively.

Mandatory beneficiary registration to check overpricing

Under the new guidelines, if the sale price of an EWS unit under the AHP component exceeds the current Annual Statement of Rates (ASR) by more than 20%, such projects will now be required to secure beneficiary attachment, or confirmed registration, of at least 25% of beneficiaries before actual construction work can begin. This is designed to ensure genuine buyer demand exists before a project proceeds, rather than pricing being set arbitrarily ahead of construction.

Similarly, for AHP-PPP projects where the EWS unit price exceeds the ASR rate by more than 20%, the same 25% beneficiary registration requirement will apply, but as a precondition before the project is granted the increased FSI sanctioned under PMAY or any other benefits under PMAY (Urban) 2.0. Once beneficiary registration is completed, such proposals must be resubmitted to the State Level Project Management Unit (PMU) before the scheme’s benefits can be extended.

Built-up area capped at 1.4 times carpet area

A significant homebuyer protection built into the guidelines caps the built-up area of EWS units at a maximum of 1.4 times the carpet area, for both AHP and AHP-PPP projects. This means implementing agencies cannot inflate the built-up area figure, which is often used as a basis for calculating sale price, beyond this defined ratio. The circular directs that this ratio be strictly adhered to while filling built-up area details in Annexures 5B, 5C and 5D, or while computing the sale price of units, preventing a common practice where inflated built-up-to-carpet ratios are used to justify higher prices for smaller usable spaces.

Mandatory NOCs before project submission

The guidelines note that most implementing agencies have either not submitted the required No-Objection Certificates or have simply stated that these would be submitted later, while presenting AHP and AHP-PPP proposals. Going forward, project proposals must be accompanied by three valid NOCs at the time of submission:

• A water supply NOC from the concerned Municipal Corporation, Municipal Council, Jal Jeevan Authority or other competent authority
• A sewerage/drainage NOC from the concerned Municipal Corporation, Municipal Council or competent authority
• An electricity supply NOC from MSEDCL or another government body, or the relevant authorised private power distributor

This is intended to ensure that projects granted approval have verified access to essential civic infrastructure before construction proceeds, reducing the risk of homebuyers moving into units without functioning water, sewerage or power connections.

No government liability for unsold units

The circular also clarifies that once a PMAY (Urban) 2.0 project is completed, the state government will bear no liability for any units that remain unallocated or vacant. This places the onus squarely on implementing agencies to ensure realistic project sizing and genuine demand assessment upfront, reinforcing the rationale behind the new beneficiary-registration requirement.

Applicability

All implementing agencies submitting AHP and AHP-PPP proposals under PMAY (Urban) 2.0 have been directed to ensure compliance with these guidelines while preparing and submitting future proposals. The circular has been issued digitally, carrying the reference code 202601231643582209 on the Maharashtra government’s official portal, and copies have been marked to Additional Chief Secretaries of the Urban Development Department, the Vice Chairman and CEO of MHADA, the Director of Municipal Council Administration, all Divisional Commissioners, all District Collectors, and all PMAY (Urban) 2.0 implementing agencies across the state.

Also Read: Maharashtra Implements ‘SNA-SPARSH’ System for Faster Fund Transfers under PMAY (Urban) and PMAY 2.0

The post PMAY-U 2.0: New Rules Cap Built-Up Area, Protect EWS Homebuyers from Overpricing appeared first on Square Feat India.

The directive, issued via a Government Resolution (GR) dated January 23, 2026, comes after the State Level Appraisal Committee (SLAC) flagged widespread inconsistencies in Detailed Project Reports (DPRs) for Affordable Housing in Partnership (AHP) and AHP-Public Private Partnership (AHP-PPP) projects during reviews in August and October 2025.

Builders had previously been able to secure additional FSI (which translates to more saleable area and higher profits) early in the process, often without confirmed buyers for the mandatory affordable EWS component. Many projects ended up with unsold or unallotted low-cost units, defeating the scheme’s purpose of providing homes to the urban poor.

Core Changes: No Benefits Without Proof of Demand

1. 25% Beneficiary Registration Now Mandatory for High-Priced EWS Units If the sale price of EWS dwellings exceeds the current Annual Statement of Rates (ASR / Ready Reckoner rates) by more than 20%, developers must:
   • Achieve registration (beneficiary attachment) for at least 25% of the EWS units before construction begins (in pure AHP projects) or before any PMAY-U 2.0 benefits are granted (in AHP-PPP projects).
   • Beneficiary attachment means identifying and formally registering eligible EWS families who have expressed intent to purchase, backed by necessary documentation. This ensures real demand exists and prevents builders from launching projects on paper alone.
   • In AHP-PPP cases (where private developers partner with the government), enhanced FSI, central assistance, or other incentives will be withheld until this 25% threshold is met. After registration, the updated proposal must be resubmitted to the State Level Project Management Unit (PMU) for verification and final approval. This is a game-changer: Extra FSI — often the biggest incentive for builders — is now conditional on proven buyer interest.
2. Built-up Area Capped at 1.4 Times Carpet Area To stop artificial inflation of unit sizes and prices, the government has mandated that the built-up area (super built-up/saleable area) of EWS units cannot exceed 1.4 times the carpet area (actual usable interior space). This rule applies across all AHP and AHP-PPP proposals and must be reflected in pricing calculations and annexures (5B, 5C, 5D). It directly tackles past practices where developers padded common areas to justify higher costs while still claiming “affordability.”
3. Compulsory NOCs with Every Proposal DPRs submitted without the following valid No Objection Certificates (NOCs) will no longer be processed:
   • Water supply NOC (from municipal corporation/council/Jal Jeevan Pradhikaran).
   • Sewerage/drainage NOC.
   • Electricity supply NOC (from MSEDCL or authorized provider). Earlier submissions often lacked these, leading to delays and compliance gaps.
4. Government Washes Hands of Unsold Units Post-completion, any unallotted or vacant EWS units become the sole responsibility of the developer/implementing agency. The state will assume no liability for them.

Why This Matters: Ending the “Paper Promise” Era

These guidelines mark a clear departure from lax enforcement. Builders can no longer treat PMAY-U 2.0 as a tool for quick extra development rights without delivering on affordability. By linking the most lucrative benefit (additional FSI) to real buyer registrations, the government is prioritizing demand-driven, transparent projects that genuinely serve EWS families.

All implementing agencies — municipal corporations, development authorities, and private partners — have been instructed to comply fully.

Industry observers say this could slow down some speculative projects but will ultimately lead to healthier, more sustainable affordable housing development in Maharashtra’s urban areas.

Also Read: Maharashtra Implements ‘SNA-SPARSH’ System for Faster Fund Transfers under PMAY (Urban) and PMAY 2.0

The post Builders Must Secure 25% Real EWS Buyers Before Getting Extra FSI Under PMAY appeared first on Square Feat India.