The recent reduction in lending rates by PSU banks may benefit people who are planning to invest in affordable homes in the long run but it would neither alleviate the pains of people immediately nor benefit the housing sector in the short term. Most of the units that are unsold and the ones that people are keen to invest in are priced beyond Rs 35 lakh-Rs 40 lakh and the benefit of reduction in home loan lending rates doesn’t apply to them. One fails to understand the reduction in interest rate for loans below
Rs 5 lakh at a time when one cannot even buy an empty plot at this price. What will be the fate of people who borrowed on a floating rate option and for whom the current reduction will not be applicable? There should be a more pragmatic approach to housing and interest rates should be reduced across the board. A piecemeal effort to revive the sector does not make much sense.
V Nagarajan, Chennai
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