How will the decrease in home loan interest rate help the realty sector?



Everyone is talking about the cut in the interest rates for home loans. Will actually the cut gonna help in reviving the realty sector?Is it a good time to buy a property rite now or should wait for some more time?

How will the decrease in home loan interest rate help the realty sector?
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4 Replies to “How will the decrease in home loan interest rate help the realty sector?”


  1. The lower the prime interest rate, the less hesitant people will be to take out a loan. Since most people take out loans for real estate, this means that people will be less hesitant to purchase real estate. Now is a good time to buy, although this trend may continue for a while longer still. I would not close your mortgage just yet, remain open for at least a year or so before closing.


  2. Yes! it may ! It is the best buy trans-duration which may or may not remain further.Reduction in property prices and home loan rates could boost demand.A recovery in the property market in the next six months hinges on lower home loan rates to lure first-time buyers. Mortgage rates in India are at 12 percent to 13 percent, about twice what they are in China. That is unrealistic ! If rates are cut, the domestic demand itself will carry the country through this difficult period.It’s tough to say if a cut in interest rates will change the sentiment.In the current environment, people in India will be wary of buying property and stretching themselves. With rising interest costs and high property prices, buyers were pinning their hopes on loan rate cuts to buy homes in the festive season. For developers, who are staring at a demand slowdown, unchanged rates meant they could not prop up the sales in a traditionally busy season.High interest rates have already dented property demand in the past few quarters and expectations were that rates would soften after the Reserve Bank of India (RBI) announced a 100-basis point cut in the repo rate to 8 per cent and another 250 basis points cut in the Cash Reserve Ratio (CRR) to 6.50 per cent. However, the country’s largest bank, State Bank of India, on Monday said it would keep its lending rates, including home loan rates, unaltered.Even though loans will become cheaper, the bank plans to tighten the criteria for lending to individual borrowers.


  3. This is a perfect time to buy property especially for the NRIs. The dollar is at historic heights which will give NRis an additional benefit of approx 20-25% in the pricing from the last 3 months.

    Additionally, for any investor, this is a good time to buy properties as the prices have fallen significantly If they are going to fall further seems a distant possibility as with the government coming out to revive the industyr might only fuel up the prices again. This cut in interest will definately make the indian properties more affordable. Add to it that today there are lots of properties in the value housing PAN India.





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