Assotech CMD Sanjiv Srivastava said government is of the firm opinion that most of the loan seekers will be covered under the scheme. Finance secretary Arun Ramanathan has said that around 75% of the loan is of less than Rs 7.5 lakh. However, consultants say that most of these loans were taken before 2003, when the market was subdued.The proposed scheme of government to make available lower home loan rate to end-users will remain a non starter. It will not help in reviving the sector, which is facing the worst downturn in the last 10 years, because of high interest rates. The small-ticket size of the loan that qualifies for the proposed low interest rate is the reason that will sink the proposed scheme.
Under the proposed scheme, government has asked banks to prepare a package to make home loan up to Rs 20 lakh available in the range of 7-8%. According to banking sources, the banks are planning to offer home loan up to Rs 5 lakh at around 7% and that of between Rs 5 lakh and Rs 20 lakh at around 8%. The present interest rate on home loan offered by public sector banks is around 10%.
But, the scheme is unlikely to benefit homebuyers in most cities in the country. This is mainly because there are hardly any apartments or houses available for up to Rs 25 lakh. Most of the properties available in the cities of National Capital Region, Mumbai, Chennai, Pune, Bangalore, Kolkata and Hyderabad are in the range of Rs 40 lakh to Rs 50 lakh.
To read more, please, visit - The Economic Times
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