Looking for affordable rent? PMAY-U 2.0 has an option, but there's a catch

Cheap housing rent can be a lifeline for migrant workers in cities where costs are high. But under PMAY-U 2.0, being eligible does not mean a flat is waiting for you. Here's what the scheme offers, who can get it, and where rental homes may actually be available.Affordable rental housing under PMAY-U 2.0 is aimed at urban households who cannot afford to buy a home. (Image: File)For a migrant worker, a construction labourer or a domestic worker, who moves to a city for work, finding a roof close to the workplace can be almost as important as finding the job itself. High rents, insecure accommodation and long commutes often push low-income workers towards overcrowded or informal housing options.This is the gap that the Affordable Rental Housing (ARH) component of the Pradhan Mantri Awas Yojana-Urban 2.0 (PMAY-U 2.0) seeks to address.Interest in the rental-housing component is again in the news as states are processing projects under PMAY-U 2.0 and the Central Sanctioning and Monitoring Committee (CSMC) reviews and sanctions additional units. As of the latest CSMC meeting on August 6, around 13,046 units had been sanctioned under the ARH vertical, with the bulk of the earlier major sanctions reported in Andhra Pradesh, Gujarat and Maharashtra.Major migrant destinations such as Mumbai and Bengaluru are also covered under PMAY-U 2.0, since the scheme applies to all statutory towns and notified urban areas across the country. Actual availability, however, still depends on projects being proposed and approved by the state and city authorities, such as municipal corporations and local development authorities.The ARH component primarily targets Economically Weaker Section (EWS) and Low-Income Group (LIG) households. Its potential beneficiaries include urban migrants, industrial and construction workers, working women, street vendors, rickshaw pullers, domestic workers, contractual employees and other service providers who need short-or-medium-term housing near their workplaces. The vertical, which has been part of the scheme since September 2024, is intended to create affordable rental accommodation for urban households that do not own a pucca house and are unable or unwilling to purchase or construct one.BEING COVERED BY THE SCHEME DOESN'T MEAN A FLAT IS AVAILABLEGetting a rental home under the scheme is not as simple as being eligible for it.First, the state or city body has to identify the need — how many migrant workers or low-income families need rental homes in a particular area. Then they, or a private company working with them, have to prepare a detailed project proposal. This proposal goes through several levels of approval — first at the state level and then, where required, at the central level.Only after these approvals are given can construction or conversion of buildings start. Until that entire process is completed, the rental flats do not exist for people to rent.So, even though cities like Mumbai and Bengaluru are covered under the scheme on paper, a worker looking for an affordable rental home today will find one only if the state and city authorities have already planned, approved and built (or converted) such projects in that area.TWO MODELS TO CREATE AFFORDABLE RENTAL HOMES FOR MIGRANT WORKERSUnlike a direct housing-allotment programme, the rental component is demand-driven, and it is being implemented through two models.Under the first, vacant government-funded houses can be repaired, retrofitted and converted into rental units by public agencies or through public-private partnerships (PPP).Under the second, public or private entities can build, operate and maintain rental housing complexes on their own land for eligible EWS and LIG households, industrial workers, working women and other targeted groups.The projects are expected to provide basic infrastructure such as water supply, sanitation, sewerage or sewerage systems, internal roads and community facilities. Depending on the project, these may also include health facilities, crches and limited commercial spaces.Rents are determined based on local surveys, while rents for converted housing can be revised periodically within prescribed limits.Details such as available units, rents and occupancy are required to be updated on the Unified Web Portal and the websites of local urban bodies.For people looking for accommodation under the scheme, the practical question is therefore not simply whether PMAY-U 2.0 provides for affordable rentals, but where these units are available, how much they cost and whether they are accessible to the workers and families they are meant to serve.- EndsPublished By: Anand SinghPublished On: Sep 9, 2026 17:15 IST