The Punjab government has rolled out its much-publicised Apni Chhat Apna Ghar (ACAG) scheme, branding it as a breakthrough for low-income families. The offer sounds attractive: interest-free loans, easy terms, and a promise to help thousands who own a plot but cannot afford to build a home.

On paper, it looks like a game changer. The government has allocated 105 billion rupees to issue 70,000 loans, each up to 1.5 million rupees, repayable in seven to eight years through monthly installments of around 14,000. For families paying rent, the idea of shifting that money into a loan installment seems like an easy bargain. But the arithmetic does not add up. Building even a modest single-story house on a Five-Marla plot requires 40,000 to 45,000 bricks, nearly 3.7 tons of steel, and 400 to 450 cement bags—before adding labor, fittings, doors, plumbing, and wiring. The total cost climbs to at least 4.5 to 5 million rupees. Against this backdrop, a loan of 1.5 million barely scratches the surface. The scheme, therefore, benefits only a narrow group: families already holding 3.5 million rupees in hand. For them, the loan fills a gap and construction gets completed. For the vast majority, however, it risks becoming a puzzle with missing pieces.

This is where the programme must be viewed through the state’s lens as well. Billions of rupees in public funds are being poured into a scheme that may end up producing half-built structures—resources locked in concrete without delivering the promised social stability. There are ways to fix this. One option is to raise the loan ceiling so that families can realistically build not just a single-story unit, but even a double-story house. Such an approach offers a twofold benefit: the family moves into one floor while renting out the other. Rental income helps cover living expenses and provides a steady stream to repay the loan. In this way, the household becomes both stable and financially resilient. Another overlooked advantage of higher loan amounts is fiscal efficiency. Even if the government supports fewer families, larger and complete loans would ensure quicker repayments. Instead of waiting seven to eight years, recovery could be achieved in three to three and a half year. That allows the government to recycle funds into new housing or social projects, expanding the program’s reach over time.

Flexibility is equally important. Families with greater repayment capacity should be allowed to borrow more, while loan structures should be designed to guarantee a livable, finished house, not half-constructed shells. It is better to serve fewer families properly than to spread resources thinly across projects that cannot be completed. At the heart of the issue is a simple truth: cement, steel, and labor follow market prices, not government intentions. Any housing policy that ignores this reality risks being reduced to paperwork rather than concrete results.

A house is not built with announcements; it is built with bricks, mortar, and roofs that can withstand the rain. Families do not measure promises in billions, but in doors, windows, and walls that keep them safe.

If the Punjab government wants the ACAG scheme remembered as a genuine success, it must align its ambition with economic realities. Otherwise, it may go down not as the programme that gave people homes, but as the one that gave them fragments—because in housing, half a roof is no roof at all.

(The writer is a Research Economist at the Pakistan Institute of Development Economics (PIDE). He can be reached at: hanzla@pide.org.pk)

Note: This article first appeared in the Business Recorder on Oct 02, 2025.