To provide relief to homebuyers whose apartments have been delayed for years, Finance Minister Nirmala Sitharaman said on February 1 that a SWAMIH Fund 2 will be established with ₹15000 crore allocation to help complete an additional 1 lakh housing units.
She said that under the Special Window for Affordable and Mid-Income Housing (SWAMIH) Fund, 50,000 dwelling units in stressed housing projects have been completed and keys handed over to homebuyers, and another 40,000 units will be completed in 2025. This will further help middle-class families who are paying EMIs on loans taken for apartments andrent for current dwelling units.
“Building on this success, SWAMIH Fund-2 will be established as a blended finance facility with contribution from the government, banks and private investors. This fund of ₹15,000 crore will aim for expeditious completion of another 1 lakh units,” Sitharaman said.
What is the SWAMIH Fund?
Funded by the finance ministry, the fund is aimed at debt financing of stressed and brownfield residential properties.
The fund, established in 2019, is managed by SBICAP Ventures Ltd, a State Bank Group company.
This was one of the demands of the real estate sector. The finance ministry should allocate ₹50,000 crore to the second tranche of the Special Window for Affordable and Mid-Income Housing (SWAMIH) fund in the upcoming union budget for FY 2024-2025, the real estate community had said.
Under the SWAMIH Fund-1, ₹15,530 crore has been raised so far with an aim to provide priority debt financing for the completion of stressed, brownfield and Real Estate Regulatory Authority (RERA) registered residential projects that fall in the affordable, mid-income housing category.
Since the fund considers first-time developers, established developers with troubled projects, developers with a poor track record of stalled projects, customer complaints and NPA accounts, and even projects with litigation issues, it is considered the lender of last resort for distressed projects.
Chintan Patel, Partner – Deal Advisory and Head – Building, Construction and Real Estate, KPMG in India said that “SWAMIH Fund 2 is a much welcome step from the Hon’ble Finance Minister and will definitely help complete a number of stranded projects. SWAMIH Fund 1 was a big success and helped a large number of affordable and mid-income home buyers whose projects were stalled due to lack of funds.”
The launch of SWAMIH 2 with a ₹15,000 crore fund is crucial to reviving stalled residential projects and ensuring timely home deliveries. With an estimated 1 lakh housing units set to benefit, this initiative will boost buyer confidence, enhance liquidity in the real estate sector, and support overall housing market stability, driving sustained growth in the industry, said Vimal Nadar, Head of Research at Colliers India.
Last month, SBI Ventures had said on X that the fund has achieved a milestone by completing 50,000 homes.
“Milestones achieved: 50,000 homes completed under SWAMIH Fund. Transforming lives of homebuyers in stalled projects, redefining impact investing and setting benchmark in real estate,” SBI Ventures said in a post on X.