 "India's home sales, prices to rise, defying rate hikes: Puravankara CEO")
Puravankara Ltd, one of India's top property developers, expects both prices and new home sales to rise in the near future, defying rising interest rates, partly due to a recovering job market and strong demand from older millennials, a top company executive said.
The Reserve Bank of India has raised the benchmark repo rate by 190 basis points since May to battle stubbornly high inflation. Banks, in turn, have also hiked their rates, making various loan schemes costlier for borrowers.
"Buyers have already factored that rate hike in and there is still some headroom there," CEO Abhishek Kapoor told Reuters in an interview late on Wednesday.
"The interest rate is at around 8% right now for home loans, and I think the threshold is till 9%, after which we might see some impact."
Puravankara operates in nine Indian cities and competes with other developers such as Brigade Enterprises Ltd and DLF Ltd.
The company recently posted sales of 7.93 billion rupees for the quarter ended Sept. 30, with the average sale price jumping 12%.
Also Read
Kapoor said that bookings and purchases by older millennials and first-time buyers were on the rise in recent months.
"Last year, about 7% to 8% of our sales were coming from the under-35 age group. This year we have seen the climb go up to 17%," he said.
Puravankara plans to launch 15 million square feet of new property by the end of this financial year.
(Reporting by Nivedita Bhattacharjee in Bengaluru; additional reporting by Biplob Kumar Das; Editing by Savio D'Souza)
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)