Impact Of Work From Home On Realty Sector
Mumbai: Real estate developers expect home loan rate cuts by banks and mortgage lenders to spur sales during the festive season.
Both public and private sector banks, including the State Bank of India, Kotak Mahindra Bank, Bank of Baroda and Punjab National Bank, are offering home loans at record low interest rates to tap into the consumer demand ahead of the festive season.
Housing Development Finance Corporation (HDFC), the country's largest private mortgage lender, joined its peers on Tuesday by announcing an offer with home loans starting at 6.70%.
"The festive season marks an auspicious period brimming with positive sentiments and more disposable income to splurge. This induces potential homebuyers to grab the best festive deal with the array of competitive financing options from banks by slashing interest rates and fees waiver to attract the home loan customers," said Niranjan Hiranandani, national vice-chair man, Naredico.
Many homebuyers may abstain from making purchases during the ongoing Pitrupaksha period that - will come to an end in the first week of October. However, the festive quarter of October December usually witnesses a surge in housing sales across cities as homebuyers prefer this auspicious period, which includes Navratri, Durga Puja, Dussehra and Diwali, to book and buy properties.
"The pandemic has accelerated the demand for home ownership as people seek secure and independent living spaces," said Parag Munot, managing director, Kalpataru. "Softening of interest rates will further enhance home affordability which is already at its best in over two decades. It will boost demand and play a significant role in real estate recovery which is crucial to overall economic rebound." Kalpataru has projects across Mumbai, Pune, Hyderabad and Noida.
HDFC's offer will be applicable to all new loan applications irrespective of the loan amount or employment category. The special festive offer is for all loan slabs and for all customers with credit score of 800 and above. Kotak Mahindra Bank has reduced its home loan interest rates to 6.50%, which will be available for a limited period from September 10 till November 8.
"The real estate market has seen decent sales this year and this reduction in interest rates would further help to keep up the sales momentum," said Cherag Ramakrishnan, MD, CR Realty
Experts said with record low interest rates, stable prices and attractive payment plans, the pent-up demand will soon translate into sales.