Tuesday, July 3, 2012

Decline in home loan share in Bank’s Credit

RBI has observed continuous decline in the share of home loans in the bank’s credit in this fiscal despite the fact that total outstanding credit to home loans rose by Rs. 179,857 crore in last 4 years period. The reason may be the economic slowdown and the drastically growing real estate prices.
 “While the slowdown in economy had its impact, high inflation ate into household budget and at the same time real estate prices went up sharply, leading to a slowdown in demand,” said Brinda Jagirdar, GM and head of economic research at State Bank of India. “RBI too played some role by tightening the prudential norms and enhancing the provisioning requirement so as to prevent a housing bubble.”
The data gathered by Department of Registration and Stamps, shows 18.5% decline in registration of new homes in Mumbai in 2011-12.







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