Home Loan Interest Rate Cut Can Revive The Residential Real Estate In India

Home Loan Interest Rate Cut Can Revive The Residential Real Estate in India

by

rishab jain

\”Feel Good\” customers, developers and banks, this Diwali …

Good times await in Indian real estate. This is hard-pressed to lower demand and output growth in the number of Indian banks is finally cut mortgage interest rates. Interestingly, the banks are appropriately chosen Diwali period to reduce interest rates and treat their move as a festive offer.

The real estate sector can cause the current revival of India\’s economic turnaround and to stimulate growth. Real estate experts predict that the new housing projects in the beginning can help arrest the current slowdown to 6% in 2012-13, compared to 6.5% in 2011-12.

\”Revival of the real estate sector will have a positive impact on 250 industrial, says Lalit Kumar Jain, president of CREDO, real estate developers body in India

\”While it is backed mortgages banks homebuyers solid collateral, borrowers default probability is very low, banks should charge 7% interest rate on a mortgage. Indeed, as the net loss on non-performing home loans segment assets is close to zero, banks should lend to rate equal to the cost of funds, including management fees.

If the mortgage loan to 7%, will be a spurt in demand in the housing sector, which will help revive the economy. In fact, if the home loan interest rate is 7% about 10% from the current level of personal borrowing capacity to go. \’

Bankers positive note, fingers crossed and hope that this initiative will encourage people to come to a decision to buy a house. , Real Estate Developers, on the other hand, I also think, that the saw will probably revive the ailing commercial real estate market and under the sofa, the picture is much clearer view of how the market will do next.

In actuality, it is only to reduce the interest rate that banks mortgage lending segment, the growth rate has been over the past 3 years downslide.

Earlier in the fiscal year 2005-06, the Indian banks have written over the years (YoY) growth rate of 49.5%, 73.9% and 48.6%, respectively, but most declined to 29.1% in 2005-06, and 26 6% in 2006-07. Cut size is not available, it was estimated that this number continue to go up 15-17% in the current fiscal. And in this case, it was an inevitable decision to reduce interest rates, bank officials admit.

In the meantime, what can be due to the effects of the banking sector gimmick, he finally Indian real estate industry and consumers, who would be most useful.

Home loan interest rate is the largest and most important factor that promotes Indian real estate and interest rates rise about 5 percent. Over the past couple of years has been hammered by the industry, the construction group senior official said.

Also, for the last report, Assocham Impact Rising mortgage interest rates, residential real estate demand in India fell by an average of 20 percent. Over the past 12 months, a considerable increase of interest rates. Therefore, interest rates softening recovery time in the industry.

Up to this moment, India\’s largest public sector bank SBI reduced mortgage interest rate of 0.75 per cent to 10.50 per cent. Private sector major HDFC also also reduced the interest rate from 11 percent to 10.50 percent. ICICI Bank, Baroda, etc., as well as reducing their lending rates from 0.50 to 1.00 percent suit.

Previously, the index rose 2000-2002 amounts to 6-7 percent range of 11-14 percent 2005-2007. Such a significant increase really put a significant impact on people who intend to buy a home depending on mortgages bearing pockets and residential real estate demand has been quite visible throughout the country.

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