Stalled real estate projects soon to pick up speed
Bangalore- Good news to builders and developers whose projects have been kept on hold due to liquidity crisis. The finance ministry has planned to initiate a measure which is expected to improve the realty sector.
Banks will be allowed to permit funds to stalled projects, which would revive the growth in economy.
As per RBI‘s latest data, banks credit limit for housing sector, has increased by 12.1 percent year on year basis. This means the bank credit is lesser than the growth rate of aggregate bank credit which is 15.9 percent.
A senior official alleged that in order to revive the realty sector, a number of options have been proposed and a measure will soon be followed. Several suggestions from public banks have been put forward like lower provisions for banks in the loan norms and allowing loans to particular projects.
RV Verma, Chairman of National Housing Bank (NHB) said that the authority is planning to give refinance assistance of around 9000 crore to home loan organizations by next June.
Considering the current real estate market scenario, Finance minister put forth the issue in a meeting held with the chiefs of state-run banks. The minister has asked government-owned banks to create pressure on real estate developers to bring down property rates, which would help in overcoming economic slowdown. But, banks are helpless because several developers are not ready to reduce property prices.
The sector has marked a marginal growth of 6.7 percent in the third quarter of 2012, which was the same in the same period last year, market analysts are of the opinion that there is a slowdown in private consumption. Revival of realty sector is expected to influence production level and industries such as steel, cement and other construction related industries.
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Bangalore, Banks, Builders and developers, Cement, Construction, consumption, Economic slowdown, Finance Minister, Finance ministry, Funds, government-owned banks, home loan, Industries, liquidity, loan norms, Market analysts, National Housing Bank (NHB), Property Prices, Property rates, Public banks, RBI, Real Estate Developers, Realty sector, steel
