Owing to Budget 2013-14
's incentive to the housing sector, banks and housing finance companies (HFCs)
are seeing a rise in the demand for housing loans.
In his Budget speech,
Finance Minister Mr. P. Chidambaram had said those taking loans of up to Rs. 25
lakh from a bank or a / housing finance corporation for a first house would be
entitled to an additional interest deduction of up to Rs. 1 lakh.
He had added the move
would promote home ownership and provide a fillip to a number of industries
such as steel, cement, brick, wood &
glass.
Mr. Keki Mistry,
Vice-chairman and chief executive,HDFC, said, "With an average loan size
of Rs. 21 lakh, this would definitely have a positive impact on our
business."
Customers in Tier-II
and Tier-III cities would benefit from this, he said, adding in metros, people
in far-flung suburbs would benefit. He, however, said it would be premature to
comment on the likely impact, in terms of absolute numbers.
Indian Banks agreed
the Budget announcement would aid first-house buyers.
First-house buyers
portfolio 60 %
Mr. Ram Sangapure,
General Manager (Retail), Central Bank of India, said, "Currently, the
proportion of first-house buyers in our portfolio is 60%; we expect it would
rise to 65%."
He also said the
Union Budget announcement, along with a fall in interest rates, would raise
growth in housing loans from 16% to 23% next year.
Mr. Kapil Wadhawan,
Chairman and Managing Director, Dewan Housing Finance said, "This
announcement brings cheer to many potential house buyers, especially in the
lower and middle income segments in distant suburbs of metros & tier-II and
tier-III cities who have delayed their decision of home buying"
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