Prime Minister Narendra Modi in his speech on New Year’s Eve announced – much to the cheer of homebuyers, the government’s decision to provide interest subvention on the housing loan.
The government is offering to provide 4% and 3% interest rate relief on housing loan up to Rs 9 lakh and Rs 12 lakh respectively. Additionally, he also announced 3% rate subvention for loans of up to Rs 2 lakh to build and expand existing houses in rural areas.
The government has also decided to increase the number of homes to be built in rural areas under Prime Minister Awas Yojana (PMAY) by 33%.
This move is expected to bolster the demand of affordable and low cost housing – especially in the peripheral localities of urban areas. Shailesh Puranik, Managing Director, Puranik Builders commented, “The government’s announcement related to affordable housing and interest exemption, will fuel the growth in this segment and will give more people access to homes. Add to that, Banks offering home loans at much lower interest rates and we will have happy customers all around. Puraniks is planning to launch a large affordable housing project very soon and we are happy that such incentives in this category can really provide much needed boost to real estate segment.”
While all the policy measures including the last year’s budget provided sops for affordable and low cost housing, these new measures come as much needed fillip to the real estate sector which was rattled by the demonetisation move. These moves will improve the sentiment among buyers as well as developers of the specific segment.
Getamber Anand, president — CREDAI National opined that this will provide a strong boost to mass housing in peripheral areas of all eight metro cities. “Localities like Bhiwadi, Nimrana, Daruhera around Noida extension and Yamuna Expressway in the NCR region will see good demand for housing as average loan size for houses is between Rs 10 and Rs 12 lakh. This will kick-start markets on the outskirts of Mumbai, Pune, Hyderabad, Bengaluru, Ahmedabad and Chennai.”
To read more info on affordable housing stay tuned for the Feb issue of Surfaces Reporter.
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