With the country now taking a huge
leap towards development and with the new government focusing on creating
affordable homes for every Indian in the next few decades, it doesn’t come as a
surprise to see banks doing their bit to help potential buyers invest in homes.
Private banks are now on a home loan rates slashing spree to attract buyers.
ICICI Bank is the latest
establishment that has joined this bandwagon and has reduced its home loan
rates by 10 bps (basis points). This initiative will not only strengthen the
market (after the lull the real estate industry faced during the election
season) it would also push home buyers to invest in homes. These techniques
used by the banks will revive the realty scene across the country and will
accelerate credit growth in terms of housing loans. The banks will receive an
added advantage as the improving liquidity will ease the pressure of funds.
Although the slashed home loan rates
are valid only for a limited period of time, this technique is sure to be a hit
amongst potential buyers as the realty scene in Tier II cities is considered to
be alluring according to a recent survey. And with buyers postponing their home
buying decision in the hope of a stable government, the erosion in the loan
rate margin will now urge potential buyers to consider buying a home as they
would be able to save a considerable amount.
Besides just the banks and home
buyers, developers and builders also stand to gain from this move. High
property prices, high interest rates and most importantly the election lull had
put the real estate industry in a tough spot. Incentives
such as these would encourage hesitant buyers and will bring them back into the
market.
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