Kochi: The central government is likely to announce a huge stimulus plan to revive the housing sector, which is suffering due to high mortgage rates and rising prices of raw materials. The government is preparing to announce a package for the real estate sector on the assessment that interest rates will not come down any time soon as inflation will take time to come under control. To overcome the sharp increase in the price of construction products and the increase in interest rates, the central government is making a scheme to provide subsidy of Rs 60,000 crore for the housing sector. It is proposed to provide interest subsidy of around one per cent per annum through banks to customers taking home loans. . Interest concessions on home loans may be available through banks for the next five years.
Government sources indicate that the plan will be announced after the elections to five states. The central government is of the opinion that the interest rate reduction in the housing sector will bring a lot of relief to the common people who are suffering due to price rise. Interest concession will be available for loan amount up to 50 lakh rupees with tenor of 20 years. It is estimated that 25 lakh home loan customers in the country will benefit from the scheme. Union Finance Ministry officials will next day hold talks with the country’s top bank chiefs to ensure that the benefits of the scheme reach the grassroots level.
According to bank officials, the project will help in providing more credit to the housing sector. With the economic sector of the country returning to good growth, the demand for home loans is increasing. Following the pace of the global market, with the price of construction materials falling in India as well, customers are actively considering realizing their dream of owning a house as soon as possible, say banking industry insiders. The movements of change are strong in the real estate market, which has been moving in a severe recession for the last two years. Meanwhile, despite the positive situation in the market, the high interest rate of loans is causing problems for the consumers. Home loan interest rates have touched close to 10 per cent as the Reserve Bank has hiked the key rate by 2.25 per cent in the last one year to control inflation. But homebuilders are expecting key interest rates to start coming down after December. They also estimate that the housing construction sector will become more active with this. Demand for home loans has increased by over twenty percent in the last six months. With prices of construction materials and metals falling, consumers are showing more interest in taking home loans.
Business is improving
Flat and villa sales have improved significantly in metro and urban areas in recent months, according to leading homebuilders. Along with this, foreign Malayalis are also investing in housing in urban areas like Kochi, Kozhikode, Thiruvananthapuram and Thrissur. Retail customers are also active in the loan market. It is expected that the demand for bank loans will increase as the vehicle market becomes more active in the coming months. All the leading flat construction companies have announced many benefits and concessions in the new situation. Overseas Indians are also active in the housing market as the rupee depreciates sharply against the dollar.
2023-11-05 19:08:00
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