New Delhi: The recent home loan interest rate cut by various banks has started showing results. Things are now picking up in the residential real estate segment. Builders and financial institutions have started receiving enquiries once again, after a long drought.
Sanjiv Srivastava MD Assotech said, "There is a clear change in trend in the last couple of weeks. Many who had dropped the idea of buying an apartment after the interest rate hike in January 2007, want to complete the deal now."
Many banks like HDFC, IDBI, SBI, ICICI, Axis Bank, Canara Bank, Bank of Baroda, Bank of India had slashed their interest rates on floating rate home loans to tap the festive season. In addition to the cut in interest rates, banks had also organized special fairs, offered discounts on processing fees to lure in more customers. The hike in floating rate home loan during the past few months had dried up their business and forced the banks to offer discounts despite no such indications by RBI.
The recent demand for new home loans is mostly for the non-premium segment - that is for apartments costing around 50 lakhs. The premium segment is currently facing a peculiar oversupply situation and is not witnessing too many enquiries.
Hemant Jain Director, KLJ builders said, "The group's ongoing residential projects in Faridabad Nahar Paar area, Bahadur Garh and Gurgaon are receiving a good number of enquiries." The availability of home loans at low rates is expected to act as a catalyst and revitalize the sagging home loan industry.