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The demand for housing loans seems to be slightly lower in the eastern region of the country. Kolkata-headquartered United Bank of India and Allahabad Bank have given out mixed signals regarding the current demand for home loans. While officials of Allahabad Bank found the demand “stable”, UBI officials confirmed that there was a slowdown in demand. According to UBI officials, the slack season coupled with rising interest rates have resulted in a slowdown in demand for home loans.
Senior UBI officials told Business Line that demand for home loans picked up during the festive season in October. However, towards the close of the financial year-end there has been a slowdown in demand. Interest rates have gone up by nearly two percentage points which has led to several investors postponing their decisions on opting for home loans, officials said.
Bankers do however caution that any analysis of home loan demand has to be done with reference to specific regions. “For instance demand is down in Mumbai, Delhi and Hyderabad. If one speaks in terms of the entire industry, I think, it slowed down a little compared to last year,” said Ms Renu Challu, Managing Director, State Bank of Hyderabad (SBH).
The dip could possibly be driven by increase in real estate prices or surplus supply. “But the Rs 20-30 lakh loan segment is doing well while the mid-size loans are down,” she added.
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