Showing posts with label Faridabad. Show all posts
Showing posts with label Faridabad. Show all posts

Wednesday 10 October 2012

Property prices in TN stabilising: Sundaram BNP Paribas Home Finance

Coimbatore, Sept. 10:

Real estate prices in the Chennai market, which had trebled in the past five years, have taken a breather with property prices in the metropolis stabilising, according to Srinivas Acharya, Managing Director, Sundaram BNP Paribas Home Finance Ltd, Chennai.

He said though his company is not into reverse mortgage right now, it is open to the concept and would respond positively to any customer demand.

Speaking to Business Line here on Monday on the sidelines of the opening of its second branch in the city, he said the company’s loan profile has witnessed robust growth. He expected to close the first half of the current fiscal with a disbursement of about Rs 1,200 crore equalling what the company had disbursed in the whole of 2010-11 FY. In 2011-12, the loan disbursement was about Rs 1,950 crore

He said while demand was ‘still there’, what was happening at Chennai and Coimbatore was that real estate ‘prices have stabilised’ and property price increases were not taking place as frequently as in the past. Describing it as a ‘good sign’, he expected this development to draw more people to investment in housing.

While this could partly be due to buyers’ resistance, a key factor was that mega projects were taking time and absence of any price escalation in them was having an impact on smaller projects.

He said the Chennai real estate market had witnessed the sharpest growth in the country during the 2007-12 period. According to the NHB Residex, the 20-city housing price index with 2007 as the base year, Chennai realty prices had more than trebled in five years. Its nearest competitors were Faridabad, Pune, Bhopal and Indore but their gains were far less — just double the base rate. He did not expect the demand for residential space in Chennai and Madurai, among others, to come down.

Confirming the slowdown in growth in commercial real estate projects, Acharya said this segment was dependent on economic growth. The slowdown in the economy was having an impact on this sector as corporates have put the breaks on branch expansion. Even in the mall space, there was oversupply, particularly in Delhi. But Chennai could see some more malls that were specific to the residential areas where they spring up.

S. Rajagopalan, VP & Head-Operations, SBNPP Home Finance, said a big mall was coming up in the OMR area in Chennai that would fill the need for such a facility in the area.

On whether home loan rates would head South, Acharya said “home loan rates have more or less stabilised” in the past few months and the rates would go down only if the interest rates fall. But he felt that the interest rates did not have a great bearing on the purchase decision of home buyers.

He said the home finance companies are also becoming alive to the changing social situation that is reflected in loan tenures. Earlier, the home loans were made co-terminus with 60 years of age of the borrower. This was extended to 65 years and today loan closure up to 70 years is possible in exceptional cases. What has facilitated tenure extension is that companies are extending the retirement age of their employees to beat back attrition.

Referring to the home loan companies re-jigging products such as waiver of last year’s instalment for prompt repayment, Rajagopalan said in the experience of most home loan providers, the maximum loan tenure has been 12-13 years. This was because of the preference for pre-closure of loans. Besides, the loan’s tax efficiency tapers off as the term progresses.

On whether his company was eyeing the reverse mortgage space, Acharya said his company did not offer this product now. But as more parents were left to take care of themselves, the need for it would grow. There has been no request for it from its clients but his company was watching the trend and would ‘certainly come out with it’ once the demand arises in the coming years.

He said the branch opened in the R.S. Puram area in Coimbatore today was the 89th branch and 39th in Tamil Nadu. So far this year, 13 new branches have been opened and 12 more were slated for opening in the remainder of the year, enabling the company to cross a century of branches.

Source: http://www.thehindubusinessline.com/news/states/article3881135.ece

Tuesday 20 March 2012

Chennai tops in residential property cost

Contrary to the popular belief, it was not the country’s Capital city Delhi but Chennai in down South which witnessed maximum increase in prices of residential properties as high as 166 per cent — among major cities in five years since 2007.

According to the Economic Survey 2011-12 tabled in the Parliament on Thursday by Finance Minister Pranab Mukherjee, residential property prices soared by 54 per cent during the period in Delhi.

However, in comparison, it trailed much behind Bhopal where property rates zoomed by117 per cent followed by NCR Faridabad (116 per cent) Kolkatta (92 per cent), Mumbai (87 per cent) and Ahemdabad (67 per cent).

The survey has attributed the spiraling property prices to the shooting cost of the infrastructural materials such as concrete and iron as well as better connectivity particularly with the upcoming metro network

“The possible reasons for increase in prices could be overall increase in inflation rate particularly relating to building materials, improvement in infrastructural facilities like metro connectivity resulting in increased demand for housing, favourable political and economic environment and increased business and employment opportunities,” says the survey.

The other cities where real estate market was buoyant were Pune and Lucknow which saw a jump of price hike by 63 per cent and 60 per cent respectively in the residential property between the years 2007-2011. Prices in Surat and Patna also soared by 47 per cent and 43 per cent respectively.

However, astonishing as it was, four cities, according to the survey, witnessed drastic decline in prices. Maximum decrease was observed in Jaipur by 36 per cent in the said five years followed by Hyderabad (14 per cent) Bengaluru (6 per cent) and Kotchi (2 per cent).

However, with the real estate market booming, the survey has tried to drew attention of the policy makers to the widening gap between demand and supply of the housing units resulting from inadequate housing.

The other main cause of concern was that while the finance sector in the country has experienced buoyant growth over the past several years, homelessness amongst the lower segments of population has continued to increase.

“Despite significant growth of the housing loan portfolio in the sector, access to formal credit was mostly available to people in the formal sector…Sizeable segments of the informal segment market still remain untouched,” said the survey giving a macro and micro-view of the country’s economy.

Source: http://www.indianrealtynews.com/real-estate-india/chennai/chennai-tops-in-residential-property-cost.html