1. • CommentAuthorshantaramc
   • CommentTimeJul 21st 2008

    

   • Answers: 1
   • Joined: Jul 21st 2008

   Report Abuse
   what will be interset rates and price of real estates in bangalore down the line in 5 years can anybody help us in this regards
2. •  
     CommentAuthorvikram
   • CommentTimeJul 24th 2008

    

   • Answers: 104
   • Joined: Jun 20th 2007

   Report Abuse
   In the absence of suitable corrective measures, housing loans growth will further slow down between 17-20% in current fiscal.
   
   Rising home loan rates have severely impacted the housing sector as their growth has fallen to 26.6% from 29.1% in last year and in the absence of suitable corrective measures, housing loans growth will further slow down between 17-20% in current fiscal.
   These findings have been incorporated in a Study on `Impact of Rising Home Loan Rates’ carried out by Assocham.
   
   Findings:
   
   * Real estate market has seen a drop of 60% in sales.
   * Metros where the drop was noticed include Delhi, Mumbai, Kolkata and Bangalore; its impact could further worsen if reversal in rising interest rates for housing is not addressed urgently.
   * Prior to fiscal 2005-06, a year-on-year rise was seen: of 49.5%, 73.9% and 48.6% respectively.
   * Since no suitable corrective measures to contain interest rates, particularly in the housing segment have been effected, nearly 60% of home aspirants are staying away from pre-launch sales.
   * Builders, usually rely on the advance amount received by way of pre- launch bookings. The money is collected well before construction starts but loans are becoming costlier as buyers are not willing to expose themselves for an extended time period. Instead, they are waiting for completion of construction. Several developers have deferred the launch of their residential projects.
   * Referring to differential between EMIs, prevailing at 7% and 12%, approximate change in EMI for housing loan of Rs 10 lakh works out to be Rs 3250 and puts an additional burden of Rs 39,000 per annum on end-users. Likewise, on Rs 20 lakh housing loan, approximate change in EMIs at the interest rates varying between 7% to 12% works out to be Rs 6520 and puts its taker an additional burden of Rs 78,240 per annum. A housing loan of Rs. 30 lakh, EMI differential works out to be Rs9770 with additional fiscal burden of Rs 1,17,240 per annum.
   * Speculators play a significant positive and negative role in pushing property prices by more than 20% and rise in interest rates help speculators to occassionally dictate prices.
   * Recent boom in property market coupled with low interest rate regime served as a breeding ground for speculators (property brokers, big or small retail investors).
   * Speculators usually buy units in bulk by paying margin money and by creating an artificial shortage, putting pressure on prices. With funds becoming dearer, there has been a significant slowdown in speculated purchasing activities by investors in at least the short-term.
   * The risk rewarded ratio of speculators has been thrown out of gear. The risk has magnified as buyers are adopting 'wait and watch policy' for the time being with the expectations of correction doing the rounds.

Categories: General | Legal Queries | NRI | Stamp Duty | Property Valuation | Home Loans | Selling Home | Buying Home | Housing Society | Interior Decoration | Vastu / FengShui