RBI hiked Home Loan Interest for the 11th Time
The Reserve Bank of India (RBI) has hiked the interest rate for home loan for the 11th time since 2010-as it wants to curb inflation. RBI’s move is aimed at curbing speculation in the real estate market.But the move has not gone down well with existing and prospective flat buyers. It is not being effective at the ground level due to ancillary factors.
When Ranjith Thomas, a finance executive, heard the RBI had hiked interest rates, his heart sank. His monthly outgoings for the Rs 20 lakh loan he had taken last year had just gone up from approximately Rs 16,000 to Rs 19,000. Reena Mathias, a senior executive with a share-broking firm, on the other hand, has just dropped the idea of purchasing a flat. “I cannot afford to pay such a high rate. As such, the flat rates are too high. I would have to shell out an EMI of about Rs 40,000 for a dingy flat costing Rs 40 lakh in Thane. It’s much better to stay on rent. My monthly outgoings do not go beyond Rs 10,000,” said Mathias, who shares a 2-BHK with two others in Juhu.
Even though we have not taken any other loans, I have to practically shell out my entire salary of Rs 50,000 towards house maintenance and the house loan,” said Ritvik Shah, an executive with a marketing company in Andheri. Shah took a Rs 40-lakh loan in 2006 for the two-BHK flat.
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