Home loan shows slower growth as against previous years
Despite cuts in interest rates in home loans by banks, the growth in this segment has dipped as against previous years, as per Reserve Bank of India’s credit data.
The trend of availing home loan to the housing sector was 13.3 percent in January 2012 which has dipped down to 12.3 percent in January 2013.
One reason for this downtrend is assumed to be the hike in property prices in metro cities. However, there is good demand for home loans in smaller cities and towns.
The priority sector lending category has also showed a slower growth of only 6.9 percent in January from 7.9 percent in January 2012. Priority sector lending means the home loans which are taken above Rs 25 lakh in metros and Rs 15 lakh in smaller towns.
The home loan incentive which was announced recently by the Finance Minister with the Union Budget 2013 has been the talk since its release. The real estate developers are the ones who can cheer the most with the incentive.
One can claim the tax deduction only if his/her loan amount is less than Rs 25 lakh. Also, it has been mentioned that anyone who takes loan in between April 1, 2013 and March 31, 2014 can only be able to enjoy the benefit.
Also, the developers can now expect to clear the growing pile of unsold stock over the past two years. Out of 583,513 unsold apartments present in the country, 39 percent cost less than 35 lakh.
Developers in Mumbai were hoping that with the upcoming Union Budget 2013 will improve investment volumes and generate growth across real estate sector in Mumbai.
Mumbai real estate industry expects increased provisions of external commercial borrowings for low-cost housing, tangible tax relief for individuals and greater investments in infrastructure.
Related Real Estate News:
Online approval of home loans by SBI
Hike exemption limit on interest of home loan: Builders’s Association
Home loan tax deduction, a boon to realty developers
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