Under the House Building Advance (HBA) rules, Central Government employees can buy a house or flat, or a plot to build a house valued up to ₹1.25 crore.
However, the maximum HBA that they can claim is limited to only ₹25 lakh, according to the “Compendium of House Building Advance (HBA) Rules and FAQs” released recently by the Ministry of Housing and Urban Affairs.
The HBA rules allow an employee to buy a house/flat or plot worth up to 139 times of basic pay or ₹1 crore, whichever is lower. However, the cost ceiling may be increased by 25% in individual cases by the Head of Department. This means, the maximum cost of the house or plot for which HBA can be claimed by an employee is ₹1.25 crore, for which an employee can apply for HBA.
“Cost of the house to be built/purchased (excluding the cost of plot) should not exceed 139 times of the basic pay of the employee, subject to a maximum of ₹1.00 crore (one crore) only. In individual cases, if the Administrative Ministry is satisfied on the merits of the case, the cost ceiling may be relaxed up to a maximum of 25% by the Head of the Department,” the compendium says.
However, the maximum amount that can be claimed as HBA is only ₹25 lakh.
The maximum amount of advance shall be “34 months basic pay subject to a maximum of ₹25.00 lakhs only (Rs. Twenty five lakhs), or cost of the house/flat, or the amount according to repaying capacity, whichever is the least for construction/purchase of new house/flat.”
There are also various other restrictions that you can check in the compendium here.
House Building Advance (HBA) is admissible to Central Government employees for buying a house, plot, flat, etc.
Existing employees who have already taken a home loan can also switch to HBA.
This allowance is available for all permanent Central Government employees. There are also some other eligibility conditions for other Central Government employees that you can check in the compendium.
The current interest rate charged for HBA is 7.44%. The interest rate is reviewed every Financial Year in consultation with Ministry of Finance