Good News for Borrowers as Lending Rates Fall at Last!
Following the RBI’s decision to keep the repo rates unchanged, three ace Indian Banks, which include the State Bank of India, one of the massive government owned bank, ICICI and HDFC, leaders in the private sector, have slashed their base lending rates.
While SBI and HDFC, has strategised to slash their lending rates by 15 basis points each, to 9.85 per cent, the other one, ICICI Bank, plans to slash its rate by 25 basis point to 9.75 per cent. There are possibilities that other banks might also join the bandwagon soon. In case of SBI’s, its new lending rate will come into effect from April 10, HDFC Bank’s from April 13 while ICICI Bank will shore up with its new rate in one end, from April 10 for its existing consumers, on the other end, the new borrowers can enjoy this rate from July 1.
With these cuts by the banks, the existing as well as new consumers are expected to benefit a decent proportion. While with this enforcement by the banks, home loans are also anticipated to see a reduced interest rate along with policy revamp, which seems to definitely make the real estate sector experience certain gain.
And henceforth, commonfloor here welcomes this move by bringing to you, a few of the expert opinions shared by realty stalwarts.
Have a look.
Kishor Pate, CMD – Amit Enterprises Housing Ltd
Some of the leading banks have set the score by picking up on the RBI’s signals and reducing their lending rates by between 0.15-0.25 basis points. Several other banks have now followed suit. I expect this to be only the first of more reductions to follow. There is invariably a lag between the directives given by the RBI with regards to lowering lending rates, and banks complying with these directives.
It is encouraging that these banks have taken the initiative, leaving other banks with little option but to follow suit.
The housing loan segment is an extremely competitive one, and it is noteworthy that home loan disbursements in the Pune region had reduced significantly in recent times. With this positive development, we expect the rate of loan purchases via home loans to begin picking up in Pune, which is a very cost-sensitive market.
Arvind Jain, Managing Director – Pride Group
It is very encouraging to see that several banks are complying with the RBI’s strong indications for the need to reduce their lending rates. This will have a favourable effect on sentiments currently prevailing in the housing sector, which have been dampened in the recent past. Home buyers have been shying away from pressing the commit button on property purchases, and have preferred to wait for encouraging signals.
Sales in Pune have stabilized over the last three quarters, and the most momentum being seen primarily in the budget homes segment. This strongly indicates that the market is skewed towards affordability, and reduction in interest rates is a critical factor in affordability. I expect sales momentum to start picking up visibly, and also believe that more rate cuts will follow on the heels of the stronger economic signals being felt in the country.
Current Interest Rates for Leading Banks (Hypothesis-Loan Amount: Rs 20 lakh, Loan Period: 15 years)
